The United States and the European Union have agreed to end the growing dispute over US steel and aluminum tariffs imposed by former President Donald Trump in 2018, removing irritants in transatlantic relations and preventing a sharp rise in EU retaliatory tariffs.
US Commerce Secretary Gina Raimondo told reporters that the deal would keep US Section 232 tariffs at 25% on steel and 10% aluminum, while allowing “limited quantities” of EU-sourced metals to be imported duty-free into the United States.
It will also end one of the most pressing concerns between the Allies and allow them to focus on negotiating new global trade agreements to address the global overcapacity in steel and aluminum, mainly concentrated in China, and reduce industrial carbon dioxide emissions. .
US officials did not indicate the amount of duty-free steel allowed into the United States under the quota system agreed with the EU. Sources familiar with the deal said that annual volumes in excess of 3.3 million tonnes would be subject to tariffs.
The deal provides an additional two years of duty-free access above the quota for EU steel products, which was eliminated by the Department of Commerce last year, US officials said.
The deal requires EU steel and aluminum to be produced entirely in a block - a standard known as "fused and poured" - to qualify for duty-free status. The regulation aims to prevent minimum processing of metals from China and non-EU countries in Europe before exporting to the US.
President Joe Biden has attempted to mend relations with European allies since the Trump presidency to more broadly counter China's state economic practices, which have resulted in Beijing creating huge surplus steel production capacity that has flooded global markets. p>
Raimondo said the deal would lower costs for US steelmakers. Steel prices have more than tripled over the past year to over $ 1,900 a tonne as the industry struggled to cope with rising demand following the COVID-19 pandemic halt, fueling inflation.
Europe exported about 5 million tonnes of steel to the US annually prior to Trump's introduction of Section 232 tariffs in March 2018 for reasons of national security.
The deal also lifts Europe's retaliatory tariffs on US goods, including whiskey and Harley-Davidson motorcycles, which were supposed to double on December 1, US officials said.
The United States allows duty-free imports of steel and aluminum from trade partners in North America, Mexico, and Canada, with a mechanism that allows tariffs to be reimposed in the event of a sudden surge in imports.