Donald Trump doubles US steel and aluminium tariffs to 50%

As of May, imports and the rate of raw steel production in the US had changed little since last year before Trump raised tariffs, according to the American Iron and Steel Institute.

But steel imports fell 17% in April, compared to March. And businesses selling the metals into the US said they expected Trumps latest announcement to lead to an even more dramatic drop.

Three American goods that could rise in price due to metal tariffs

Trumps moves in March had already prompted Canada and the European Union to prepare to hit back with tariffs of their own American products.

On Tuesday, Olof Gill, spokesperson for economic security and trade for the European Commission told the BBC the two sides were engaged in intense talks to try to make progress toward an agreement.

Were negotiating hard to try and make good deals, he said.

We really hope that the Americans will roll back on this latest tariff threat, as they have done on others, but that remains to be seen.

In the UK, Trumps announcement put new pressure on the government to pin down the trade deal in the works with the US, which had been expected to provide some protection from the March metals tariffs.

Trade Secretary Jonathan Reynolds met with US Trade Representative Jamieson Greer in Paris on Wednesday.

His office said it was pleased that the trade talks had protected UK steel from the latest duties.

We will continue to work with the US to implement our agreement, which will see the 25% US tariffs on steel removed, he said.

Gareth Stace, director general of UK Steel, which represents steelmakers, told the BBC that his members had already seen orders cancelled and delayed as a result of the 25% tariffs put in place in March.

He warned that a 50% tariff would be catastrophic for UK exports to the US, about 7% of overall exports.

The introduction of 50% tariffs immediately puts the shutters up, he said. Most of our orders, if not all of them, will now be cancelled.

Economists said the US economy is also facing damage, as prices rise as a result of the new measures.

A 2020 analysis estimated that Trumps first term tariffs created roughly 1,000 jobs in the steel industry, but cost the economy 75,000 jobs in other sectors, such as manufacturing and construction.

Erica York, vice president of federal tax policy at the Tax Foundation, said that she expected to see even more extreme job losses this time.

Some of the strongest evidence is against tariffs on intermediate inputs like steel and aluminium, finding they are much more harmful because they increase the cost of production in the United States, she said. Its just very foolish to double down on this type of tariff in particular.

Chad Bartusek is director of supply chain management at Drill Rod & Tool Steels, a small, family-owned manufacturing business in Illinois, which brings in about 800,000 pounds of Austrian-made steel each year, at specifications he says are not produced in the US.

Mr Bartusek said he was currently waiting on three containers worth of steel rod, which would have entered the US without duties at the start of the year.

As of last week, he had expected to pay tariff costs about $72,000. Instead, he is looking at a tariff bill of almost $145,000.

I woke up Saturday morning, looked at the news and my jaw dropped, he said of Trumps announcement.

Mr Bartusek said business had been steady until a few weeks ago.

But his firm raised prices earlier this year by 8% to 14% to help cover the new cost of the tariffs. Now customers have been ordering more cautiously and he has had to cut back hours for workers.