Donald Trump Tariffs: A Major Boost to Iron & Steel Suppliers Globally

On Feb 10, 2025, President Trump made significant changes to US steel and aluminum tariffs under Section 238 of the Trade Expansion Act of 1962, citing the need to protect the interest of domestic industry and safeguard national interest.

To achieve this, the Trump administration announced that it has increased tariffs on aluminum imports from 10% to 25% and maintained 25% tariffs on steel. Further, the government dismantled existing exemptions and broadened the scope of tariffs. This signals a shift toward a more protectionist trade policy and ignites a trade war.

Key Highlights:

1. Trump made significant changes to US steel and aluminum tariffs under Section 238 of the Trade Expansion Act of 1962
2. US iron and steel imports from the EU declined by 13% from 2022 to 2024.
3. Germany was the largest supplier of iron and steel to the US in 2024, worth $1538 million, a decline of $102 million from 2022.
4. US iron and steel exports to the world stood at $19.5 billion, in 2024, a decline of $1.3 billion, compared to 2022.
5. Canada and India witnessed a decline of $1200 and $200 Million in 2024, compared to 2022.

Trump Major Changes to: Trade Expansion Act 1962

President Trump has implemented several changes made under the Trade Expansion Act of 1962. For instance –

1. The Trump administration has changed the tariff system where tariffs are imposed on selective products and countries. Now, with changes, tariffs have become universal.
2. Tariffs on steel raised from 10% to 25% signalling a stricter stance on global trade.
3. Imposing 200% tariffs on Russian steel exports to the USA, showing a strong stance against the Russian steel industry.
4. Emphasize domestic production. With increased tariffs on foreign steel and aluminum, domestic producers will have a considerable gap to fill.

EU Exports of Iron and Steel To US

Iron and steel are the backbone of modern industry, their importance can be observed across various sectors. They are the driving force behind manufacturing, construction, and transportation, enabling innovation and economic growth. Let’s understand the US dependence on Iron and steel from the EU –

1. US iron and steel imports from the EU declined by 13% from 2022 to 2024.
2. Germany is the largest supplier of iron and steel to the US worth $1538 million in 2024, a decline of $102 million, compared to 2022.
3. Notably, Iron and steel exports to the US from major EU suppliers like Germany, Sweden, and Italy, experienced a decline in 2024.
4. Belgium’s iron and steel market which grew by 25.07% from 2022 to 2024, may witness a setback to its growing market with Trump’s tariffs. 
5. Overall, the US tariff may affect industry growth, and at the same time offer the EU to tap new markets.

Make a Chart: Title: US Imports of Iron and Steel from the European Union

Value USD Million**

Top Five Iron and Steel Suppliers to US

According to trade data, the US dependency on Iron and steel declined drastically from 2022 to 2023. This shrinking market highlights slow demand and robust domestic production.  Let’s understand this with the help of market trends –

1. The US iron and steel market declined by $12 billion or 26.7% in the last three years from 2022 to 2024.
2. Over the years, Canada has lost its iron and steel market share in the US, for instance, its exports declined by $2.16 billion or 21.9% in the last three years.
3. Due to geopolitical challenges such as the Israel-Hamas conflict, the Russia-Ukraine conflict, and the crisis in the Red Sea, the exports of iron and steel to the US have been affected. For instance, Mexico, South Korea, and Germany witnessed a decline of $2310, $780, and $110 million in 2024, compared to 2022.
4. Notably, Brazilian iron and steel exports to the US have grown significantly in the last three years.

Make A Chart: Title: US Top Five Partners for Steel Imports Globally from 2022-2024

Value USD Million**

Top Five US Iron and Steel Export Destination

According to trade data analysis, the US dependency on Iron and Steel has shrieked over the years. However, its exports to the top partners have also declined, highlighting, slow demand, and a volatile market. Let’s take a look at market trends –

1. US iron and steel exports to the world stood at $19.5 billion in 2024, a decline of $1.3 billion from 2022.
2. Mexico, Turkiye, and Bangladesh are the only countries to experience growth in iron and steel imports from the US.
3. Canada and India witnessed a decline of $1200 and $200 in 2024, compared to 2022.
4. The decline in US Iron and steel export value indicates emerging markets and competitiveness.

Make a Chart: Title: Top Five US Steel Export Destination

Value USD Billion**

How Does Trump’s Tariffs Offer a Growth Market for Global Suppliers?

Trump’s tariffs on steel and aluminum are creating havoc in the global market, challenges and opportunities for businesses. Here’s the breakdown of how these tariffs can open doors for immense growth potential for global suppliers –

 Increased Domestic Production –

Due to higher tariffs, steel and aluminum prices are soaring, making goods less competitive in the US market, and leading to a shrink in import value. This can lead to increased demand for domestically produced goods.

Shift in Supply Chain Management –

Tariffs are like an alternative source to incentivize businesses to set up their manufacturing plant in the USA. This will lead to the strengthening of the domestic supply chain.

Niche Market Development –

The change in the market could open up opportunities to supply niche markets, that rely on domestically produced goods.  

Conclusion –

Trump’s tariffs on goods have disrupted the global market and supply chain network. However, these tariffs are working as an incentive for businesses, and domestic suppliers to strengthen their local supply chain and production. Further, it opens the door for an emerging supplier to expand their business presence in new markets.