President Donald Trump is back in the protectionist well after temporarily suspending tariffs on certain Mexican and Canadian products last week. On Monday, he announced a global 25% tariff on steel and aluminum imports. These “no exceptions” are given to the country, According to For Trump.
The US is the second largest steel importer in the world. According to To the International Trade Bureau. In 2023, the US imported 25.6 million tonnes of steel and exported more than 8.2 million tonnes. About half of the aluminum used in Japan Import And by global standards, there is a very small aluminum smelting industry in the United States. Steel and aluminum imports into the US were valued at nearly $50 billion in 2024. Around Bloomberg.
Taxes on the import of these materials do not only hurt the economy of Other countriesIncluding Canada – This is Brazil and Mexico, the number one provider of steel and aluminum imports to the US, but they also have demonstrable impacts on several sectors of the US economy, including energy. .
Steel – Price It may increase According to an analysis by Citi Bank, the taxes are “a short tonne of between $100 and $150” due to tariffs. Aluminum is used in everything from fossil fuels to green energy. steel It accounts for 66% to 79% Wind turbine Mass and World Bank estimate Aluminum accounts for more than 85% of most solar energy components, including panels and racks.
Carbon steel forgings, on the other hand, are commonly used in oil and gas pipelines because they can withstand high temperatures and pressure levels. It is also resistant to resistance and is essential for offshore drilling operations. Aluminum with optimal strength to weight ratios is also used in tubular products in oil and gas equipment.
Nuclear power plants are primarily constructed of concrete and steel. Vogtle Unit 4, the latest nuclear power plant to be built in the United States. Required 330,000 pounds of stainless steel for building reactor core cooling systems. Canada was from the US The largest supplier 2023 “long product” including stainless steel.
Taxing steel and aluminum increases the costs of domestic energy projects (to be handed over to consumers) while hamstringing US energy control. In recent years, high material costs (and burdensome regulations) have led to cancellations or price tag hiking Offshore wind energy, Advanced nuclear powerand Transmission Line project. Wayne Wine Garden, an economist at the Pacific Institute, a free market think tank, could also encourage Canadian energy companies to invest in other markets such as Japan, instead of building an oil pipeline in the US. there is. “This is really one of the stupid things we can do,” says Wine Garden. reason.
Importantly, these tariffs do not meet the goal Trump has stated to “enrich America again.”
International Trade Commission Research Found The tariffs on steel (25%) and aluminum (10%) implemented during the first Trump administration have reduced production and increased costs in downstream industries, which use these materials by 0.6% and 0.2% respectively. . Total production in the downstream industry was $3.5 billion less in 2021 due to these tariffs. Tax Fund estimate Its abolishment tariffs and its allocations will increase long-term gross domestic product by $3.5 billion and create thousands of jobs.
I don’t know if the tariffs will stick or suspend. But the trade war, Even if it never happensundermines the consumers, businesses and America’s position in a globalized world.
