On June 4, 2025, steel and aluminum tariffs in the United States will double, from 25% to 50%, under a new directive by President Donald Trump. This move marks the administration’s latest effort to shield America’s core manufacturing industries from what it calls “unfair trade practices and global excess capacity,” and to restore critical production capabilities that the White House argues are essential to national security.

A Strategic Shift Under Section 232

The tariff hike is being enacted under Section 232 of the Trade Expansion Act of 1962, which grants the President authority to adjust imports that threaten to impair U.S. national security. According to the administration, rising import volumes, particularly from tariff-exempt countries, have eroded domestic production and put critical supply chains at risk.

In particular:

• Steel capacity utilization has dropped from 80% in 2021 to 75.3% in 2023.

• Aluminum production declined steadily after 2019, with utilization falling from 61% to 55%.

This decline, officials argue, could leave the U.S. vulnerable in times of crisis, unable to produce enough steel and aluminum to support defense and infrastructure needs.

Enforcement and Loophole Closure

To further strengthen enforcement, the administration is rolling out new reporting requirements for steel and aluminum content in imported products. False declarations will carry severe penalties, including fines and loss of import privileges. Only the steel and aluminum components of imported goods will be taxed under the new rate, while other components remain subject to existing tariffs.

Additionally, the U.S. will maintain its current 25% tariff on imports from the United Kingdom, pending the outcome of the U.S.-UK Economic Prosperity Agreement. A quota system or adjusted tariffs could be introduced as early as July 9, 2025.

Backed by Industry and Backed by Data

President Trump’s tariff policies have long been supported by domestic manufacturers and workers, particularly in regions like Minnesota where the steel and iron ore industries are key employers. From 2016 to 2020, steel and aluminum imports dropped by nearly a third, and over $10 billion in private investments flowed into new U.S. production facilities.

According to recent studies:

• The U.S. International Trade Commission found that Section 232 tariffs reduced imports and increased domestic output, with limited price impact.

• The Economic Policy Institute and Atlantic Council both point to increased reshoring and consumer shifts toward U.S.-made products.

• Even former Treasury Secretary Janet Yellen acknowledged that tariffs had little effect on consumer prices.

One 2024 macroeconomic study went as far as to estimate that a 10% global tariff could grow the U.S. economy by $728 billion and create 2.8 million jobs.

What This Means for Importers and Manufacturers

For importers, this change significantly raises the cost of sourcing foreign steel and aluminum, especially outside the UK. Companies relying on international supply chains for construction materials, machinery, or packaged goods with metal components should prepare now by:

• Auditing steel and aluminum content in their product lines.

• Evaluating reshoring or nearshoring options to reduce exposure to new tariffs.

• Consulting with trade and compliance experts to avoid reporting violations.

For businesses in logistics, manufacturing, and retail, staying ahead of policy shifts like these isn’t just a best practice, it’s a necessity. To stay informed, check out our regularly updated blog on tariff developments for the latest headlines and insights: In Real Time: Today’s Top Tariff Headlines.

Need to reevaluate your steel or aluminum sourcing strategy?
Let GLC help you adapt to the new tariff landscape. Reach out to our team of compliance experts and global trade strategists today: [email protected]