Understanding the Latest U.S. Tariff Changes on Steel and Aluminum
This was last updated on March 4, 2025.
In early 2025, the U.S. government announced several tariff increases specifically targeting imports of steel and aluminum from multiple countries. These tariffs aim to protect domestic industries but will have significant cost implications for businesses relying on these materials. Below is a breakdown of the latest tariff measures and their expected impact.
Summary of New Tariffs on Steel and Aluminum
| Tariff Type | Affected Countries | New Tariff Rates | Effective Dates |
| Section 301 Tariff on China | China | 25% (Lists 1-3), 7.5% (List 4a), 0% (No List) | Active |
| IEEPA Tariffs (Feb 4, 2025) | China | +10% across all lists | Active, Feb 4, 2025 |
| IEEPA Tariffs (March 4, 2025) | China | Additional +10% across all lists | Active, March 4, 2025 |
| New China Tariff Baseline | China | 45% (Lists 1-3), 27.5% (List 4a), 20% (No List) | Active, March 4, 2025 |
| Section 232 Tariffs on Steel & Aluminum | All Countries (Including Canada, Mexico, EU, Japan) | 25% on steel, 25% on aluminum (up from 10%) | March 12, 2025 |
| Steel & Aluminum Derivatives Tariffs | Select countries | 25% on steel and aluminum derivatives | March 12, 2025 |
Overview of Section 301 Tariffs (25% “China Tariffs”)
Section 301 tariffs are imposed on imports from China due to trade imbalances and intellectual property concerns in July of 2018. These tariffs affect industrial and raw materials, including steel and aluminum, with Lists 1-3 covering most manufacturing-related goods at a tariff rate of 25%. List 4a has a lower 7.5% tariff, mainly targeting consumer products, while some goods remain untaxed. As a rule of thumb, most all goods from China will have the 25% tariff levied. If you are uncertain about your product, please reach out to our team and we can help navigate accordingly.
Overview of IEEPA Tariffs (10% + 10% “China Tariffs”)
Under the International Emergency Economic Powers Act (IEEPA), the U.S. imposed an additional 10% tariff on Feb 4, 2025, with another 10% tariff effective March 4, 2025. These tariffs apply to all products subject to Section 301 tariffs, increasing costs for businesses importing steel and aluminum components. This combined 20% is the most recent “China Tariffs” levied on goods imported from China with the new administration.
Overview of the Reinstatement of Section 232 Tariffs: Raw Materials and Derivative Products
The U.S. government has reinstated Section 232 tariffs, imposing a 25% tariff on all imports of steel and aluminum, regardless of country of origin. This measure aims to protect domestic metal producers from foreign competition and strengthen national security. The tariff applies to both raw materials (e.g., slabs, billets, ingots) and finished or derivative products (e.g., steel nails, aluminum wire, pipes, and tubes). See the Index of Section 232 Derivative Products by HTS code at the end.
Maximum Potential Tariff on a Finished Steel Product (From China)
Tariff Type
Rate Applied
Section 301 Tariff (Lists 1-3)
25%
IEEPA Tariff (Feb 4)
10%
IEEPA Tariff (March 4)
10%
Section 232 Derivative Tariff
25%
Total Tariff Burden
70%
| Tariff Type | Rate Applied |
| Section 301 Tariff (Lists 1-3) | 25% |
| IEEPA Tariff (Feb 4) | 10% |
| IEEPA Tariff (March 4) | 10% |
| Section 232 Derivative Tariff | 25% |
| Total Tariff Burden | 70% |
Example: Fastener – Screw – Example Ex Works China Cost $0.10
Tariff Type
Ex-Works
China
Ex-Works Taiwan
Ex-Works USA
Section 301 Tariff (Lists 1-3)
25%
($0.025)
0%
0%
IEEPA Tariff (Feb 4)
10%
($0.010)
0%
0%
IEEPA Tariff (March 4)
10%
($0.010)
0%
0%
Section 232 Derivative Tariff
25%
($0.025)
25%
($0.025)
0%
Total Tariff Burden
70% ($0.070)
25% ($0.025)
0% ($0.000)
| Tariff Type | Ex-Works China | Ex-Works Taiwan | Ex-Works USA |
| Section 301 Tariff (Lists 1-3) | 25% ($0.025) | 0% | 0% |
| IEEPA Tariff (Feb 4) | 10% ($0.010) | 0% | 0% |
| IEEPA Tariff (March 4) | 10% ($0.010) | 0% | 0% |
| Section 232 Derivative Tariff | 25% ($0.025) | 25% ($0.025) | 0% |
| Total Tariff Burden | 70% ($0.070) | 25% ($0.025) | 0% ($0.000) |
In this example, a screw being sourced from China that was previously purchased for $0.10 Ex-Works, would now end up costing $0.17 once imported into the USA (70% increase) from China, $0.125 from Taiwan, or $0.10 from within the USA. In this simplistic example, the tariffs did not account for the holistic commercial value of the part with freight, which would include ocean or air freight. If freight were to be included, the 70% tariff would also be levied on the cost of freight if imported from China. If the same screw was sourced from Taiwan, the tariff impact would only be 25% on the freight cost.
Key Challenges for Importers Under New Tariffs
- Higher Costs – Increased tariffs raise import costs for raw materials, components, and finished goods.
- Price Increases – Businesses may pass added costs to consumers, leading to higher prices.
- Supply Chain Disruptions – Companies may need to find alternative suppliers or shift production.
- Reshoring & Diversification – Some businesses will explore moving production to the U.S. or tariff-free countries.
- Profitability Challenges – Industries with tight margins may struggle to absorb costs.
- Investment & Transition Costs – Adjusting supply chains requires time, capital, and logistical changes.
How GREAT Products Can Help Mitigate Tariffs
With these tariffs driving up the cost of imported steel and aluminum, businesses must find alternative sourcing solutions to remain competitive. GREAT Products offers strategic solutions to help companies navigate these challenges by reducing reliance on high-tariff imports and optimizing supply chain costs.
Our Solutions for Tariff Mitigation Strategies
- Reshoring, Nearshoring, & Friendshoring: Shift production to North American suppliers to minimize tariff exposure and reduce lead times.
- Strategic Sourcing: Diversify supplier base to avoid sourcing from heavily tariffed regions.
- Cost-Effective Assembly & Kitting: Reduce inbound shipping costs by consolidating components into pre-assembled kits.
- Optimized Material Sourcing: Leverage domestic and duty-free supply channels to reduce dependency on foreign steel and aluminum.
