Trump announces steel and aluminium import tariffs

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President Donald Trump has ordered an across-the-board 25% import tax on all steel and aluminium entering the US in a major expansion of existing trade barriers.

The tariffs, which will increase the costs of importing the metals into the US, come despite warnings of retaliation from some political leaders in Canada - America's biggest supplier of the metals - as well as other countries.

US businesses dependent on the imports have also raised concerns, but Trump has said his plans will boost domestic production.

He warned there would be no exceptions, saying he was "simplifying" the rules.

Share prices of the major US steel-makers rose on Monday in anticipation of the order, with the price of Cleveland-Cliffs jumping nearly 20%. Prices for steel and aluminium also jumped.

But the response in much of the rest of the market was muted, reflecting questions about how serious Trump is about his plans, given his track record of postponing tariffs, or negotiating exemptions to the rules.

In 2018, during his first term, he announced tariffs of 25% on steel and 15% on aluminium, but eventually negotiated carve-outs for many countries including Australia, Canada and Mexico.

"This is sort of a replay of 2018," said Douglas Irwin, a professor of economics at Dartmouth College. "The biggest question is the uncertainty over whether this is a bargaining tactic or whether he just doesn't want to talk with other countries and really wants to help out the steel industry in that way."

The US is the world's largest importer of steel, counting Canada, Brazil and Mexico as its top three suppliers.

Canada alone accounted for more than 50% of aluminium imported into the US last year.

If the tariffs stick, they are expected to have the most significant impact on Canada, which sends much of the steel and aluminium it makes abroad, the vast majority of it to the US.

Ahead of the announcement, Ontario premier Doug Ford, whose province is home to much of Canada's steel production, accused Trump of "shifting goalposts and constant chaos, putting our economy at risk".

The lobby group for Canadian steel makers called on the government to retaliate against the US "immediately", while Kody Blois, a leading MP from Canada's governing Liberal Party, said his country was looking for ways to reduce its trade relationship with the US.

"This is completely upending what has been a very strong partnership," he told Tim Franks on BBC Newshour ahead of the official order. "In just a few short weeks he (Trump) has completely changed the dynamic - the genie is out of the bottle."

Last week, the Trump ordered import duties of 25% on all Canadian and Mexican products, only to delay that plan for 30 days. He also brought in new US levies of 10% on all Chinese goods coming into the US, prompting retaliation from China.

As well as international backlash Trump is facing concerns about the effect in the US, where many manufacturers inside the US use steel and aluminium in their products and now face the likelihood of added costs.

In Trump's first term, the tariffs, despite many exemptions, raised the average price of steel and aluminium in the US by 2.4% and 1.6% respectively, according to the US International Trade Commission.

Economists have also tied the tariffs to wider job losses in manufacturing - as many as 75,000 by one estimate.

Stephen Moore, who advised Trump's campaign on economic issues in 2016 and is currently a senior fellow at the Heritage Foundation, a conservative thinktank based in Washington, said he did not think tariffs on steel and aluminium were effective way to create jobs, noting the experience of the first term.

He said while trump is "deadly serious" about trade, he thought the plan was "about getting the rest of the world's attention".

"Just about everything Donald Trump does in Washington is a negotiating tactic," he said.

Nick Iacovella, a spokesman for Coalition for a Prosperous America, which represents steel-makers and supports the tariffs, said his group is most concerned about a surge of steel imports from Mexico, above levels agreed in 2019.

But he noted that Canada sends far more goods to the US than it imports - a trade deficit that has been a key issue for Trump.

"There are still imbalances with the Canadian and United States trading relationship that should be addressed," he said.

He added: "I don't think they're planning to take a one-size-fits-all hammer approach to this, but I think early on, in the beginning at least right now, I do think what the president is saying ... [is] both of those countries [Canada and Mexico] are abusing their relationship with the US and we're going to do something about it."