Trump's 25% Tariff on Steel and Aluminum Sparks EU Retaliation

President Donald Trump's 25% tariff hike on steel and aluminum imports went into effect on Wednesday, marking the latest step in his administration’s efforts to redefine global trade rules in favor of U.S. manufacturing.

The European Commission quickly retaliated, announcing that it would impose counter-tariffs on $28 billion worth of U.S. goods starting next month, following the implementation of Trump’s tariffs.

"We regret the unjustified US 25% tariff on steel and aluminium imports. The EU will protect its consumers and businesses," the Commission said in a statement. "We are launching swift, proportionate countermeasures worth up to ($28 billion), matching the economic impact of the US tariffs."

Trump's move to strengthen protections for U.S. steel and aluminum producers reinstates a 25% global tariff on all metal imports and extends duties to a wide range of downstream products, from nuts and bolts to bulldozer blades and soda cans.

Ahead of the tariff deadline, Trump had threatened to raise the duty to 50% on steel and aluminum imports from Canada. However, he backed down after Ontario Premier Doug Ford agreed to delay his province’s 25% surcharge on electricity exports to Minnesota, Michigan, and New York until the previous U.S. tariffs were lifted.

The incident caused turbulence in U.S. financial markets, already on edge due to Trump’s expansive tariff strategy, but did not alter his initial plans to bolster the Section 232 national security tariffs on steel and aluminum, which were first introduced in 2018 during his first term.

The U.S. Customs and Border Protection agency halted imports eligible for duty-free entry under quota agreements well before the midnight deadline, notifying shippers in a bulletin that quota paperwork had to be processed by 4:30 p.m. local time on Tuesday at U.S. ports of entry, or the full tariffs would apply.

The countries hit hardest by the tariffs include Canada, the largest foreign supplier of steel and aluminum to the U.S., as well as Brazil, Mexico, and South Korea, all of which had previously benefited from certain exemptions or quotas.

While most U.S.-Canada trade remains tariff-free under the USMCA agreement signed by Trump in 2020, he continues to criticize Canada's high tariffs on dairy products.