President Donald Trump’s tariffs on steel and aluminum imports are causing significant disruptions in global markets and intensifying tensions with key trading partners, including Canada, Mexico, and the European Union.
Some countries are retaliating with their own tariffs, others are seeking exemptions, and a few are attempting to negotiate their way out of the 25 percent duties.
So, who is escalating the trade war, who is trying to avoid it, and what does this mean for industries relying on these metals?
Who supplies steel and aluminum to the US?
Canada, Brazil, and Mexico are the top three suppliers of steel to the US, accounting for about 49 percent of its imports between March 2024 and January 2025, according to the International Trade Administration. The remaining leading suppliers include South Korea, Vietnam, Japan, Germany, Taiwan, the Netherlands, and China, which collectively make up 30 percent of US steel imports.
Here’s the breakdown:
- Canada – 16%
- Brazil – 14%
- Mexico – 9%
- South Korea – 8%
- China – 2%
For aluminum, the largest suppliers are Canada, the United Arab Emirates, Russia, and Mexico. Canada dominates, responsible for nearly 40 percent of US aluminum imports, followed by the UAE, Russia, and Mexico.
The tariff war will have widespread effects on US manufacturers and consumers, as steel and aluminum are critical for producing home appliances, cars, planes, phones, and buildings.
Steel is a backbone material for construction, manufacturing, transport, and energy, with the construction sector alone using one-third of all steel imports. This will increase costs for infrastructure projects like airports, schools, and roads. Aluminum, lightweight and corrosion-resistant, is essential for the automotive and aerospace industries, as well as food and beverage packaging.
The US is particularly dependent on aluminum imports, with roughly half of its aluminum supply coming from foreign sources.
Last year, US imports of steel and aluminum were $31 billion and $27 billion, respectively, according to the US Department of Commerce.
Vina Nadjibulla, vice president of research and strategy at the Asia Pacific Foundation of Canada, stated that the tariffs are especially damaging because there is “little economic or genuine national security rationale for them.”
“The US can’t realistically onshore enough of these commodities, so the duties mainly create economic pain for American consumers and key trading partners,” she told Al Jazeera.
Instead, the tariffs introduce a level of “unpredictability and volatility we haven’t seen in decades.” By undermining established trade norms, the US “effectively encourages other nations to respond in kind, with devastating impact for the stock markets and investor and consumer confidence across North America and beyond,” Nadjibulla added.
How are countries responding?
Canada
As the largest supplier of steel and aluminum to the US, Canada has taken a strong stance against the tariffs. Prime Minister Justin Trudeau called them “unjustifiable” and a “dumb thing to do.”
Canada announced 25 percent retaliatory tariffs on $20.6 billion worth of US goods, including $8.8 billion on steel and $2 billion on aluminum imports. It has also imposed nearly $10 billion in additional tariffs on US products like computers, servers, display monitors, water heaters, and sports equipment.
These countermeasures take effect on Thursday.
“We are going to stand up for our workers, and we are going to make sure the American people understand that their leadership’s decisions have consequences,” Trudeau said earlier this week.
Mark Carney, who will succeed Trudeau as prime minister, has pledged to maintain the tariffs until the US commits to fair trade practices, stating he is willing to take “a much more comprehensive approach to trade.”
“We firmly believe that in a world fraught with geopolitical and economic uncertainties, it is not in our common interest to burden our economies with tariffs,” he said.
The latest tariffs are in addition to the 25 percent counter-tariffs on $20.8 billion of US imports imposed on March 4 in retaliation to an earlier Trump tariff that was delayed by a month.
European Union
The EU has also announced retaliatory measures targeting over $28 billion worth of US goods, including motorcycles, peanut butter, and jeans. These measures will roll out in two phases:
- Phase 1 (April 1): Reinstating previously suspended tariffs on $8.7 billion worth of US products, including steel, aluminum, bourbon, and motorcycles. These counter-tariffs, imposed between 2018 and 2020 during Trump’s first term, were suspended under the Biden administration.
- Phase 2 (mid-April): Introducing new tariffs on an additional $19.6 billion worth of US exports, such as poultry, dairy products, fruits, and cereals.
European Commission President Ursula von der Leyen warned that these tariffs will increase prices and threaten jobs on both sides of the Atlantic.
“We deeply regret this measure. Tariffs are taxes. They are bad for business and even worse for consumers,” she said, adding that the EU “will always remain open to negotiation.”
Mexico
Mexico’s response remains unclear. President Claudia Sheinbaum has indicated that retaliatory tariffs would only be implemented if negotiations fail. However, she has already secured a temporary waiver deal with Trump, exempting Mexican imports under the USMCA trade agreement until April 2.
Analysts note that goods not complying with the USMCA could still face the new 25 percent tariffs.
This follows a one-month delay in the tariffs, during which Mexico and Canada agreed to boost border security measures. Trump has followed through on his campaign promise to impose tariffs on Mexico to curb immigration and drug trafficking across its borders.
Brazil
Despite being one of the hardest-hit nations, Brazil has chosen diplomacy over retaliation. Brazilian officials are engaging in talks with Washington, hoping to secure an exemption.
The government led by left-wing President Luiz Inacio Lula da Silva issued a statement regretting the “unjustifiable” move by the US.
“President Lula told us to remain calm, noting that in the past we have negotiated under conditions that were even more unfavourable than the current ones,” Finance Minister Fernando Haddad said.
South Korea
Trump has accused South Korea of taking advantage of the US, claiming Seoul’s average tariff is four times higher, although without providing proof. The trade between the two close allies is almost tariff-free due to a free trade agreement.
“And we give so much help militarily and in so many other ways to South Korea. But that’s what happens,” Trump said during his address to the US Congress earlier this month.
He also promised to scrap the CHIPS and Science Act, under which several Korean companies, including Samsung Electronics, receive US assistance.
South Korea has opted for negotiation rather than confrontation and has activated a “full emergency response mode” to protect local industries.
Acting President Choi Sang-mok said Trump’s “America First” policy had started targeting South Korea. South Korean officials are actively seeking dialogue with their US counterparts to negotiate potential exemptions and address mutual concerns.
Trade Minister Cheong In-kyo is scheduled to visit Washington, DC, on March 13-14 to discuss reciprocal tariffs and investment opportunities, aiming to influence the Trump administration’s trade policy report.
China
Although China is not a leading steel supplier to the US, it has taken the tariffs as a direct economic attack and responded aggressively.
Mao Ning, spokesperson at the Chinese Ministry of Foreign Affairs, said the move violates World Trade Organization rules. China, the world’s largest steel producer and second-largest economy, will take all necessary measures to safeguard its rights and interests.
“No one wins in a trade war or a tariff war,” the spokesperson said.
China has already imposed tariffs on the US in retaliation to the 20 percent blanket tariff imposed by Trump.
How will the tariff war affect US ties with its allies?
Australia, another key US ally affected by Trump’s tariffs, said it would not retaliate. Prime Minister Anthony Albanese called the tariff “entirely unjustified” but ruled out reciprocal tariffs as they would affect Australian consumers.
Canberra had secured an exemption from steel and aluminum tariffs during Trump’s first term.
According to Vina Nadjibulla, these tariffs paint the US as “an unreliable partner for its closest allies.”
She said countries like Canada, Australia, and South Korea “will look to minimize their vulnerabilities” by diversifying trade partners.
“When large economies engage in tit-for-tat tariff escalations, the risk of a global trade slowdown looms larger,” she said. “These measures don’t just hurt the near-term bottom line – they threaten the entire framework of open trade that has underpinned much of the world’s economic growth and stability.”
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