President Trump’s sweeping tariffs on foreign steel and aluminum went into effect on Wednesday, escalating America’s trade spats with global competitors, including close allies already reeling from his on-and-off approach to trade penalties.
Mr. Trump’s tariffs of 25 percent on the metals hit imports that enter the United States from any country in the world. The move, which many domestic steel and aluminum makers support, is expected to raise costs for American manufacturers of cars, tin cans, solar panels and other products, potentially slowing the wider U.S. economy.
The action on metals was just the latest attempt by Mr. Trump to leverage the power of tariffs and the American market against foreign governments. Last week, he issued steep tariffs on imports from Canada, Mexico and China, blaming those countries for the entry of drugs and migrants into the United States, before quickly paring some of them back. The president is threatening to impose a raft of other tariffs, including on foreign cars and against countries that he says discriminate against the United States.
His approach has been met with a market slump and has sent many U.S. allies into a defensive mode as they try to decipher what the president actually wants. On Tuesday, Mr. Trump threatened to double the tariffs on Canadian metal after Ontario had responded to Mr. Trump’s previous tariffs by putting a surcharge on electricity exported to the United States. Within hours, Ontario had suspended its surcharge, and Mr. Trump walked back his threats.
The metal tariffs, and other levies to come, are likely to again worsen trade disputes. Foreign governments, including in Canada, have vowed to retaliate by issuing levies that will most likely hurt U.S. exporters. On Wednesday, Europe swiftly announced tariffs on up to $28 billion worth of goods in response. The metal tariffs mainly affect U.S. allies: Canada is by far the largest supplier of both steel and aluminum to the United States. Brazil, Mexico, South Korea and Vietnam are also top suppliers of steel, while the United Arab Emirates, Russia and China are top suppliers of American aluminum.
The tariffs restore and expand similar measures that Mr. Trump put in place in 2018, which ushered in several long-running trade wars. Mr. Trump argued that the tariffs were needed to protect national security and provide a reliable source of metal for the military in wartime.
In the intervening years, both Mr. Trump and former President Joseph R. Biden Jr. made deals with foreign countries, including Brazil, Mexico, Canada and nations in Europe, that whittled away at the tariffs. The U.S. metals industry has complained that the measures were no longer strong enough to keep steel mills and aluminum smelters afloat.
Kevin Dempsey, the president of the American Iron and Steel Institute, an industry group, said that the tariffs had been “very effective” compared with previous one-off trade actions that had only targeted specific countries or specific products.
“Things would be, without those tariffs, much worse for the industry,” Mr. Dempsey said.
But because steel and aluminum are used to make so many other products, raising the price of the metal will have ripple effects throughout the U.S. economy. By increasing costs of basic inputs for many companies, the tariffs could harm manufacturers who ultimately employ far more Americans than steel mills and aluminum smelters do, potentially causing Mr. Trump’s plans to bolster U.S. manufacturing to backfire.
An economic analysis published by the U.S. International Trade Commission, an independent, bipartisan agency, suggested that the costs to the U.S. economy from Mr. Trump’s first tranche of metal tariffs outweighed the gains.
The study found that the metal tariffs levied in 2018 encouraged buyers of steel and aluminum to purchase more from U.S. sources, led to higher domestic prices for metals and expanded U.S. steel production by about 2 percent between 2018 and 2021, the years the report studied.
But the analysis also found that the tariffs raised production costs for firms making automobiles, tools and industrial machinery, shrinking production in those and other downstream industries by about $3.48 billion in 2021 as a result. The steel and aluminum industries produced only $2.25 billion more in metals that year because of the levies.
In an effort to mitigate those harmful consequences, the Trump administration has expanded its steel and aluminum tariffs this time to include various downstream goods, or “derivative products,” made with steel and aluminum, such as tractor parts, metal furniture and hinges.
Chad Bown, a senior fellow at the Peterson Institute for International Economics, a research organization, said that move was an “implicit acknowledgment” that some industries were suffering because of Mr. Trump’s previous tariffs.
He said that the tariffs created a “cycle of cascading protectionism” in which more industries would ask for government safeguards, and that it “may be difficult to stop” once it gets going.
“Where does it end?” Mr. Bown asked.
The prospect of higher costs has also encouraged other U.S. industries, like automakers, to lobby for tariffs on their foreign competitors to protect their businesses. Mr. Trump has said he plans to levy a tariff on foreign cars on April 2.
For automakers, the metal tariffs threaten to raise costs when prices of new cars and trucks are already near record highs. The average price of a new vehicle in January was more than $48,000, according to Edmunds, a market research group.
“Affordability is already a major concern for American car shoppers amid elevated prices and interest rates,” said Jessica Caldwell, head of insights at Edmunds.
Robert Budway, the president of the Can Manufacturers Institute, a trade group that represents companies making steel and aluminum cans for food, soda, beer and paint, said that tariffs would result in higher packing costs, which would ultimately be passed to American consumers.
Food packagers were relying more on imported metals, and simply paying more for them, Mr. Budway said. According to figures from the institute, the cost of a steel can had increased 53 percent from 2019 to 2024, after Mr. Trump first imposed his tariffs.
“It just makes the price higher,” Mr. Budway said.
The measures also seem likely to invite retaliation from foreign countries, rebounding on U.S. exporters.
Canadian officials have said they plan to retaliate, adding on to the 25 percent tariff their government put on $30 billion of American goods this month in response to Mr. Trump’s levies.
“The government of Canada has been clear on this issue since the beginning,” said Gabriel Brunet, a spokesman for the finance minister, Dominic LeBlanc, who is leading Canada’s trade response. “Should the United States move forward” with tariffs on metals or other fees, he said on Tuesday, “we will be ready to respond firmly and proportionately.”
Britain’s trade secretary, Jonathan Reynolds, called the tariffs “disappointing.” The country was investigating steps to protect local producers and negotiating an agreement with the United States to eliminate additional measures, he said on Wednesday. Australia would not impose reciprocal tariffs, Prime Minister Anthony Albanese said, because it would push up prices for Australian consumers.
The European Union had made it clear that it would hit back against the tariffs, which it has called “economically counterproductive,” and put forth a two-part response.
Officials will allow a suspended set of tariffs to take hold in full force on April 1, affecting everything from boats to bourbon. They are also launching a process to finalize which other goods — including farm and industrial products — to hit with higher tariffs.
The European Union’s goal is to hit the United States as hard as it is hitting Europe’s economy, in hopes of drawing America to the negotiating table.
“It is not in our common interest to burden our economies with tariffs,” Ursula von der Leyen, the president of the European Commission, said in a statement.
But making a deal has been tough. Maros Sefcovic, the trade commissioner for the European Union, said during a news briefing Monday that he had traveled to the United States last month “seeking constructive dialogue.”
“In the end, as it is said, one hand cannot clap,” he said. “The U.S. administration does not seem to be engaging to make a deal.”
European officials have also struggled to get their American counterparts on the phone.
Ms. von der Leyen has not spoken individually with Mr. Trump since his inauguration. Asked when she might do so during a news conference on Sunday, she said that “we will have a personal meeting when the time is right.”
Neal E. Boudette contributed reporting.
