EU countermeasure tariffs on US steel and aluminium

This move is part of a broader global trade conflict involving the US, which has seen similar tariffs applied by President Trump to other trading partners, including China, Canada, and Mexico.

Summary of New EU Tariffs

The Commission’s measures include a two-step approach, imposing tariffs on approximately €26 billion worth of US goods:

1. Reinstating previous countermeasures: On 1 April 2025, the 2018 and 2020 “rebalancing measures” will automatically be reinstated once their current suspension expires on 31 March. For the first time, the rebalancing measures will be implemented in full.
   • In June 2018, the EU imposed retaliatory tariffs against the US, targeting €2.8 billion worth of US goods (including steel and aluminium products, American whiskey, as well as agricultural and other goods). An additional €3.6 billion worth of US goods was scheduled to be targeted in June 2021, but these measures were suspended until March 2025.
   • In January 2020, the EU responded to additional US tariffs by imposing rebalancing measures affecting around €40 million worth of US goods. These measures were also structured into two sets, similar to the 2018 measures, and were suspended until March 2025.
2. Implementing new tariffs: Additional tariffs will be applied in mid-April to a range of US goods worth approximately €18 billion, matching the economic scope of the US tariffs.

Action in the US and UK

The EU countermeasures are a response to the yesterday’s imposition of 25% tariffs by the US on imports of steel, aluminium, and certain products containing steel and aluminium from all countries, including the EU and the UK (except Russia, who are instead subject to a 200% duty rate on aluminium). 

In a further escalation today, President Trump threatened to impose a 200% tariff on European alcoholic products, including wine and champagne.

The UK has also been hit by the US 25% tariff. While the UK Government has not immediately retaliated, it confirmed that it is closely monitoring the situation and that “all options are on the table”.

Impact

The new tariffs will affect a whole range of sectors, as not just the metals themselves are targeted, but also products that contain steel and aluminium. As it is the importer who pays the import tariffs, the measures are expected to increase costs for domestic businesses and consumers, potentially resulting in higher prices for goods.

As a significant exporter of steel and aluminium to the US, the UK will also feel the impact of the US tariffs, so a response from the UK Government is highly anticipated.