Trump Steel Tariffs Explained: Rates, Exclusions, and Retaliation

Trump’s steel tariffs currently sit at 50% on nearly all imported steel, imposed under Section 232 of the Trade Expansion Act of 1962. The rate doubled from 25% to 50% on June 4, 2025, applies to steel articles and their derivative products from every country except the United Kingdom (which kept the 25% rate under a bilateral deal), and covers the full customs value of covered products rather than just their steel content. Country exemptions and the old product-exclusion process were eliminated in early 2025.

Current Rate and What It Covers

The 50% rate took effect at 12:01 a.m. on June 4, 2025, under Proclamation 10947.¹ It applies to:

Steel articles from every country except the UK, which pays 25% under the U.S.-UK Economic Prosperity Deal announced May 8, 2025.
Aluminum articles at the same 50% rate.
Derivative products, meaning goods containing steel or aluminum as an input. A 2026 restructuring expanded this to 407 Harmonized Tariff Schedule codes, including “parts provisions” that may not always contain metal but still trigger reporting requirements.²
Canada and Mexico, despite being USMCA partners, at the full 50% rate.³

As of an April 2026 proclamation, tariffs apply to the full customs value of metal products rather than only their metal content, and a 200% duty on Russian aluminum remains in place.⁴

How the Rate Got Here

The tariff has three distinct phases. Trump first imposed a 25% rate on steel under Proclamation 9705 on March 8, 2018, based on a Commerce Department finding that steel imports threatened national security.⁵ During the first Trump term and the Biden years, that 25% coexisted with a patchwork of country-specific exemptions (Canada, Mexico, EU, South Korea, and others negotiated quotas or full exemptions) and nearly 100,000 product-specific exclusion requests filed with the Commerce Department.⁶

On February 10, 2025, Trump signed Proclamations 10895 and 10896, extending the 25% rate uniformly to all countries. “That’s all countries, no matter where it comes from,” he said.⁷ Four months later, at U.S. Steel’s Irvin Plant in West Mifflin, Pennsylvania, he announced the doubling to 50%: “At 25 percent, they can sort of get over that fence. At 50 percent, they can no longer get over that fence.”⁸

Exemptions and Product Exclusions

If you’re checking whether an exemption might apply to your imports, the short answer is that almost none exist anymore. Effective March 12, 2025, the administration revoked all General Approved Exclusions and every country-level alternative arrangement.⁵ The Commerce Department stopped accepting new product exclusion requests on February 10, 2025.

In place of exclusions, the Bureau of Industry and Security created an “inclusions process” running in the opposite direction: members of the public can ask BIS to bring additional derivative products under the tariff. Requests are accepted in two-week windows three times a year.⁵

The narrow exceptions that remain:

The United Kingdom pays 25% instead of 50%.
A reduced 15% rate applies to a subset of fixed industrial machinery, power equipment, agricultural equipment, mobile industrial equipment, and certain residential HVAC systems, under proclamations issued in April and June 2026.⁹
Preferential arrangements exist for Argentina, the EU, Japan, South Korea, Switzerland, Taiwan, and the UK under the June 2026 framework.
Products made from U.S.-origin metal at 85% or more by weight (lowered from a 95% threshold) qualify for reduced treatment.¹⁰

Effect on U.S. Steel Prices

The tariff pushed domestic steel prices sharply higher. Hot-rolled coil steel in the United States reached $1,201.50 per metric ton by May 2026, a 31% increase since the 50% rate took effect. The Bureau of Labor Statistics producer price index for iron and steel rose 10.4% between April 2025 and April 2026.¹¹ Between February and late May 2025 alone, the price gap between U.S. and European steel widened by 77%.¹²

Cleveland-Cliffs reported hot-rolled coil prices averaging $980 per ton in the first quarter of 2026, up 24% year over year.¹³ Boston Consulting Group estimated the move from 25% to 50% would add $50 billion in tariff costs, doubling the impact of the prior rate.¹²

Effect on Downstream Manufacturers and Consumers

Industries that use steel as an input have absorbed most of the cost. Construction accounts for roughly 47% of U.S. steel consumption and automotive about 25%.¹⁴ During the original 2018 tariffs, Ford and General Motors each estimated about $1 billion in additional annual costs, roughly $700 per vehicle. A U.S. International Trade Commission report found downstream industries lost $3.4 billion in annual production from 2018 to 2021.

Federal Reserve Board research linked the original 25% tariff to 75,000 fewer manufacturing jobs by mid-2019, concentrated in steel-consuming industries rather than steel producers.⁶ The Peterson Institute for International Economics calculated that the original tariffs cost about $650,000 for every steel job saved and produced $5.6 billion in additional costs for steel consumers for every $2.4 billion in income gained by the steel industry.¹⁴

Nonresidential construction spending fell from $791 billion in December 2023 to $729.3 billion in March 2026, a decline industry officials attributed partly to higher input costs. Automotive suppliers have reported focusing energy on negotiating cost recovery with original equipment manufacturers rather than absorbing the increases.¹¹

Effect on Domestic Steelmakers

U.S. steel production rose after the doubling. Year-to-date raw steel production through mid-May 2026 was 35.2 million net tons, up 6.5% from the same period a year earlier, with capacity utilization at 78.3%.¹⁵ The United States became the third-largest steel-producing nation in 2025, and over four million tons of new crude steelmaking capacity is expected online by June 2028, with new plants under construction in West Virginia, Arkansas, and South Carolina.¹⁶

Employment tells a flatter story. Iron and steel mills employed about 85,400 workers in 2025, essentially unchanged from 85,300 in 2024 and 85,500 in 2023.¹⁷ The Peterson Institute found “no long-term gain in production or jobs” from the 2018–2024 protection, with annual U.S. steel production holding at roughly 80 million tons throughout.¹⁸

Company results have been split. Steel Dynamics reported first-quarter 2026 earnings of $2.78 per share on $5.2 billion in revenue, a 93% year-over-year earnings increase.¹⁹ Cleveland-Cliffs, despite higher prices, posted a full-year 2025 net loss of $1.4 billion, nearly double its 2024 loss, driven by weak automotive demand.¹³

American Iron and Steel Institute President Kevin Dempsey said the 50% action “will help prevent new surges in imports that would injure American steel producers and their workers.”⁸ United Steelworkers President David McCall was more cautious, drawing a distinction between “public relations” and “putting workers’ interests first.”²⁰

Retaliation by Trading Partners

U.S. exporters face counter-tariffs in most major markets. When the administration reimposed full tariffs without exemptions in early 2025, Canada responded on March 13, 2025, with 25% tariffs on approximately $29 billion in U.S. goods. The EU announced counter-measures on about $28 billion in American products, phased in through April 2025.²¹

Canada announced on August 22, 2025, that it would suspend retaliatory tariffs on non-steel, non-aluminum, and non-automotive goods effective September 1, 2025, but kept its counter-tariffs on steel, aluminum, and autos.²² The UK suspended its inherited EU retaliatory tariffs after a 2022 arrangement and secured the preferential 25% Section 232 rate through the Economic Prosperity Deal.²³ China, the EU, Turkey, Russia, and India all imposed their own retaliatory duties dating back to the original 2018 tariffs.²⁴

Legal Standing of the Tariffs

The Section 232 steel tariffs have survived every serious legal challenge, so buyers and importers should not plan around a court striking them down. In American Institute for International Steel v. United States, the Federal Circuit affirmed in February 2020 that Section 232 provides a constitutionally sufficient “intelligible principle” to guide presidential action, relying on the Supreme Court’s 1976 Algonquin precedent.²⁵

A WTO panel ruled in December 2022 that the tariffs violated GATT obligations because the U.S. failed to show the measures were taken during an emergency in international relations. The U.S. appealed in January 2023, and the case remains unresolved because the WTO’s Appellate Body has been non-functional since 2019.²⁶

Bipartisan legislation introduced in June 2018 by Senators Corker, Toomey, and others to require congressional approval for Section 232 tariff actions never became law, and similar proposals in later sessions have not advanced.²⁷

Separately, on February 20, 2026, the Supreme Court ruled 6-3 in Learning Resources, Inc. v. Trump that the International Emergency Economic Powers Act does not authorize tariffs. That decision invalidated Trump’s “reciprocal” tariffs but left the Section 232 metals tariffs, which rest on separate statutory authority, in place.²⁸²⁹

What’s Scheduled to Change

The current structure is not static. On April 2, 2026, Proclamation 11021 restructured the metals regime, applying tariffs to the full customs value of products, setting 50% on primary metals, 25% on most derivatives, and 15% on a subset of fixed industrial machinery and power equipment.⁴

A June 1, 2026 proclamation then created a temporary framework running through December 31, 2027. Under this framework:

The general rate on covered articles dropped to 25%.
The 15% reduced-tariff category expanded to include agricultural equipment, mobile industrial equipment, and certain residential HVAC systems.
The threshold for products to qualify as U.S.-origin metal was lowered from 95% to 85% by weight.
Preferential arrangements were established for Argentina, the EU, Japan, South Korea, Switzerland, Taiwan, and the UK.

After December 31, 2027, rates are scheduled to revert to the higher levels set in the April 2026 proclamation unless further action extends the framework.⁹¹⁰

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