PARIS - Washington doubled its tariffs on steel and aluminum imports on Wednesday, when President Donald Trump's administration also expects trading partners to make "best offers" to avoid other punishing import levies from taking effect in early July.
Maros Sefcovic, the trade negotiator for the European Union, was due to meet US Trade Representative Jamieson Greer in Paris, with the 27-nation bloc set to make its case for cutting or eliminating threatened tariffs on European imports. Late on Tuesday, Trump signed an executive proclamation that activates from Wednesday a hike in the tariffs on imported steel and aluminum to 50% from the 25% rate introduced in March.
"We started at 25 and then after studying the data more, realized that it was a big help, but more help is needed. And so that is why the 50 is starting tomorrow," White House economic adviser Kevin Hassett told a steel industry conference in Washington on Tuesday. The increase came into effect at 12:01 a.m. (0401 GMT).
The increase applies to all trading partners except Britain, the only country so far that has struck a preliminary trade agreement with the US during a 90-day pause on a wider array of Trump tariffs. The rate for steel and aluminum imports from the UK - which does not rank among the top exporters of either metal to the US - will remain at 25% until at least July 9. The United States imports about a quarter of all its steel, and Census Bureau data shows the increased levies will hit the closest US trading partners - Canada and Mexico - especially hard. They rank No. 1 and 3, respectively, in steel shipment volumes to the US
Canada will be even more exposed to the aluminum levies since it exports to the US roughly twice as much as the rest of the top 10 exporters' volumes combined. The US gets about half of its aluminum from foreign sources.
Prime Minister Mark Carney's office said Canada was "engaged in intensive and live negotiations to have these and other tariffs removed."
Mexico Economy Minister Marcelo Ebrard reiterated that the tariffs were unsustainable and unfair, especially given that Mexico imports more steel from the US than it exports there. The increase in the levies jolted the market for both metals this week, especially for aluminum, which has seen price premiums more than double this year. With little capacity to increase domestic production, US import volumes are likely to be unaffected unless the price increases undercut demand.
'BEST OFFER' DUE DATE
Wednesday is also when the White House would like trading partners to propose deals that might help them avoid Trump's hefty "reciprocal" tariffs on imports across the board from taking effect in five weeks.
US officials have been in talks with a number of countries since Trump announced a pause on those tariffs on April 9, but so far only the UK deal has come to fruition. Even that pact, which provided the basis for the carve out from the metals tariffs, is more of a preliminary framework for more talks.
Reuters reported on Monday Washington was asking countries to list their best proposals in a number of key areas, including tariff and quota offers for US products and plans to remedy any non-tariff barriers.
In turn, the letter promises answers "within days" with an indication of a "landing zone," including what tariff rates countries can expect after the 90-day pause ends on July 8.
At issue for most trading partners is whether they retain the current baseline rate of 10% on most exports to the US after that date, or something sharply higher in many cases. Separately, alarm over China's hold on the critical minerals market is growing as global automakers joined US counterparts to complain that its restrictions on exports of rare earth alloys, mixtures and magnets could cause production delays.
China's decision in April to suspend exports of a wide range of rare earths and related magnets has upended the supply chains central to automakers, aerospace manufacturers, semiconductor companies and military contractors around the world. Uncertainty around US trade policy is creating havoc for businesses around the world. On Wednesday, French spirits group Remy Cointreau abandoned its 2030 sales growth ambitions, saying tariffs, slow US sales and high uncertainty could derail its plans for this financial year and beyond.
German engineering lobby group VDMA also blamed Trump's tariff policies and the resulting market uncertainty for a 6% drop in orders plant and equipment makers reported in May.
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