Trump Administration Reimposes Section 232 Tariffs On Canadian, Mexican Products
On March 13, the U.S. government imposed Section 232 tariffs on steel and aluminum imports and imports of certain steel and aluminum derivatives. The policy means all previously agreed upon quota arrangements with Argentina, Australia, Brazil, Canada, the European Union, Japan, Mexico, South Korea, the United Kingdom, and Ukraine have been terminated.
The Metals Service Center Institute (MSCI) issued a statement on the new policy that is available at this link.
“MSCI stands by its 2017 testimony regarding Section 232 tariffs on steel and aluminum imports into the United States. MSCI is a North American trade association that believes in free and fair trade worldwide. We support tariffs on steel and aluminum imports into North America and commend the Trump administration for expanding the Section 232 tariffs to include downstream, derivative steel and aluminum-bearing products,” the statement said. It continued, “We feel Canada and Mexico should ultimately be exempt from the tariffs, assuming free and fair trade is established between the countries. We support the administration and look forward to an expeditious decision that may ultimately lead to bi-lateral negotiations or a retooled USMCA to address the issues within the North American industrial metals economy.” The statement concluded that, “ultimately, North American trading partners should work collaboratively to address unfair trading practices by countries with nonmarket economies without imposing costly penalties on one another.”
As the law firm Kelley Drye explained, the Section 232 tariffs are cumulative with other duties imposed by the U.S. government, including those recently implemented under the International Emergency Economic Powers Act (IEEPA) against goods from Canada, Mexico, and China. For Canada and Mexico, President Donald Trump had ordered that the IEEPA tariffs, which took effect on March 4, would not apply to goods from Canada and Mexico that qualify as originating for preferential treatment purposes under the U.S.-Mexico-Canada free trade agreement (USMCA), effective March 7. Non-qualifying goods from Canada and Mexico, however, remain subject to the 25 percent IEEPA tariffs for those countries.
Because Canada and Mexico were previously exempted from the Section 232 tariffs imposed in 2018, so that means last week’s change mean non-USMCA-originating steel and aluminum mill products and covered derivative products now face up to 50 percent tariffs upon entry into the United States.
Meanwhile, the Federal Register published notices for steel and aluminum that offer lists of covered derivative products while the U.S. Customs and Border Protection issued separate guidance for the penalties on steel and the penalties on aluminum. For more information about these orders click here.
The Section 232 penalties sparked immediate reaction from governments around the globe. The European Commission (EC) said it will introduce retaliatory tariffs totaling about $28 billion. (The EC initiated a two-week public consultation to finalize the list of products that will be subject to the tariffs. It is considering applying the penalties to industrial goods such as textiles, plastics, and home appliances, as well as agricultural products.) The EC’s duties will take effect in two stages, on April 1 and April 13.
The Canadian government imposed retaliatory duties of 25 percent on C$29.8 billion worth of U.S. imports, including steel and aluminum. Those levies took effect March 13, 2025. Additionally, Canada filed a complaint with the World Trade Organization, arguing the United States’ Section 232 levies are “inconsistent with U.S. obligations under the General Agreement on Tariffs and Trade 1994.”