Biden targets China with new tariffs on steel and aluminum
President Biden announced new tariffs Wednesday on imported steel and aluminum in a bid to keep cheaply produced Chinese metals out of U.S. markets and protect domestic production ahead of the November election.
The new tariffs will focus on steel and aluminum imports from Mexico, which has become a conduit for many products of Chinese origin as the U.S. has reworked some direct supply chains away from China in the aftermath of the pandemic.
Steel arriving from Mexico will be taxed under Section 232 tariffs at 25 percent unless it has been melted and poured in Mexico, Canada or the U.S.
Similarly, aluminum from Mexico will receive a 10-percent tariff if it was smelt or cast in China, Belarus, Iran or Russia, White House economist Lael Brainard told reporters Tuesday.
The new tariffs are being coordinated with Mexican President Andrés Manuel López Obrador, who released a joint statement with President Biden Wednesday.
“To improve transparency of the origins of its imports, Mexico is requiring importers to provide more information about the country of origin of steel products. This action adds to Mexico’s recent tariff increases on steel from non-free trade agreement countries,” the two presidents said in their statement.
The new tariffs will pertain to just a fraction of total imports of the two critical metals, though import volumes from Mexico have been increasing since 2019, senior administration officials said.
The U.S. imported 28.16 million tons of steel in 2023, down 8.7 percent from 2022, according to January figures from the American Iron and Steel Institute, a trade group for North American steel producers.
Of the 28.16 million tons, 3.8 million came from Mexico, and 13 percent of those — or about 494,000 tons — were melted and poured in countries other than the U.S., Mexico or Canada, senior administration officials said.
Affected aluminum volumes are considerably smaller, as the U.S. imported 105,000 metric tons of aluminum from Mexico in 2023. Just 6 percent of those — or 6,300 tons — were smelt or cast in Russia, China, Belarus or Iran.
President Biden announced direct tariffs on Chinese steel and aluminum in April, measures that some commentators described as merely symbolic since just 2 percent of U.S. steel imports and 3.5 percent of aluminum imports come from China.
Protection measures for U.S. workers and industries has been a focus for the Biden administration ahead of the November election, as Biden has styled himself as one of the most pro-labor presidents in U.S. history.
The U.S. steel industry was thrown for a loop last December when Japanese steel producer Nippon Steel announced the acquisition of U.S. Steel at a premium price of $55 per share in a deal that received some harsh criticism from lawmakers.
U.S. Steel announced in May that the companies have received all non-U.S. regulatory approvals related to the deal.
In her agency's own statement on the tariffs, US Trade Representative Katherine Tai said domestic production of U.S. steel and aluminum were "vital" to U.S. national security interests.