Recent U.S. Trade Policies on Steel And Aluminum Products From China (September-October 2025)
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Recent U.S. Trade Policies on Steel And Aluminum Products From China (September-October 2025)
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Recent U.S. Trade Policies on Steel and Aluminum Products from China (September-October 2025)
1. Key Policy Adjustments and Tariff Measures
In September-October 2025, the United States continued to enforce and expand its tariff regime on steel and aluminum products from China under Section 232 of the Trade Expansion Act of 1962, citing national security concerns. The policies primarily targeted derivative steel and aluminum products (e.g., industrial machinery, automotive components, and household appliances) to address perceived circumvention of existing tariffs.
A. Expansion of Tariff Coverage
On September 16, 2025, the U.S. Department of Commerce announced an open application window (September 15–29) for domestic industries to propose adding new steel and aluminum derivative products to the Section 232 tariff list. This followed earlier expansions in August 2025, when 407 product categories (including wind turbines, heavy machinery, and furniture) were subjected to 50% tariffs on the steel/aluminum content. The new process aimed to "close loopholes" in tariff classification, particularly for goods with high steel or aluminum inputs but classified under non-tariffed categories.
B. Tariff Rates and Mechanisms
Base Tariffs:
Steel products: 25% ad valorem (Section 232) + potential from other measures (e.g., Section 301, countervailing duties).
Aluminum products: 25% ad valorem (Section 232), with additional penalties for misclassification.
Derivative Products:
For goods containing steel/aluminum, tariffs apply to the value of the metal content, not the entire product. For example, a $1,200 vehicle with $400 in steel/aluminum components would face **$200 in Section 232 tariffs** (50% of $400).
Enforcement:
U.S. Customs and Border Protection (CBP) intensified inspections for misclassified steel/aluminum goods, imposing fines of up to 150% of the evaded duties.
C. Trade Data and Market Impact
U.S. Imports:
In August 2025, U.S. steel imports fell 16.8% month-on-month to 1.86 million short tons, reflecting reduced demand due to tariffs and stockpiling ahead of policy changes.
China’s steel exports to the U.S. remained minimal (<1% of total U.S. imports) in 2025, as Chinese exporters redirected supplies to Southeast Asia and the Middle East.
Chinese Exports:
China’s September 2025 exports of unwrought aluminum and aluminum products dropped 7.3% year-on-year to 520,000 tons, while alumina exports surged 82.2% to 250,000 tons (due to tariff exemptions for semi-finished materials).
Domestic Prices:
U.S. steel prices rose 12% in Q3 2025 compared to Q2, driven by tariffs and supply chain disruptions.
2. Case Studies: Specific Product Tariffs
The U.S. targeted high-value steel and aluminum products through multiple trade remedy tools, including countervailing duties (CVDs), anti-dumping duties (ADs), and Section 301 tariffs.
A. Aluminum Foil and Containers
CVD Final Determination (March 2025):
Chinese exporters faced 317.85% CVDs on disposable aluminum containers, trays, and lids, effective retroactively to July 30, 2024.
Section 232 Tariffs (August 2025):
Aluminum foil products were reclassified as "derivatives," subjecting them to 50% tariffs on aluminum content.
The U.S. International Trade Commission (ITC) concluded no infringement in a case involving high-strength aluminum-coated steel used in vehicles, ending potential tariffs.
Sunset Reviews (September 2025):
The ITC extended AD/CVDs on Chinese hot-rolled carbon steel flat products for another five years, citing continued threat of injury to U.S. producers.
3. Chinese Responses and Global Implications
China adopted a two-pronged strategy to mitigate U.S. tariff impacts: export diversification and domestic structural reforms.
A. Export Diversification
Shift to High-Value Products: China increased exports of alumina (up 61.8% year-on-year in January–September 2025) and specialty steel (e.g., electrical steel for EVs) to avoid tariffs.
Regional Markets: Southeast Asia and the Middle East absorbed 35% of China’s steel exports in 2025, up from 28% in 2024.
B. Domestic Reforms
Capacity Cuts: China vowed to eliminate 15 million tons of inefficient steel capacity by 2026, prioritizing green and high-end production.
Industrial Upgrading: The Ministry of Industry and Information Technology (MIIT) set a 4% annual growth target for the steel sector (2025–2026), focusing on advanced materials and digitalization.
C. Global Trade Dynamics
Trade Diversion: U.S. allies like Canada and Mexico increased steel/aluminum exports to the U.S., but faced reciprocal tariffs from China in retaliation.
WTO Challenges: Canada and the EU continued WTO disputes against U.S. steel/aluminum tariffs, arguing they violate international trade rules.
4. Data Tables
Table 1: U.S. Tariffs on Chinese Steel and Aluminum Products (September–October 2025)
Includes automotive parts and household appliances.
Aluminum foil/containers
317.85% CVD + 25% AD
CVD/AD
March 2025
Retroactive to July 30, 2024.
Hot-rolled carbon steel
193.9–287.8% AD + CVD
AD/CVD
September 2025
Extended via sunset review.
Table 2: China’s Steel and Aluminum Trade with the U.S. (2025)
Product Category
January–September 2025 Exports to U.S.
YoY Change
Value (USD)
Notes
Unwrought aluminum
452,000 tons
-8.1%
$2.1 billion
Reclassified products face higher tariffs.
Aluminum products
520,000 tons (September)
-7.3%
$310 million (Sep)
Shift to alumina exports (+61.8% YoY) to avoid tariffs.
Steel products
~890,000 tons (2024)
-5%
~$500 million
Redirected to Southeast Asia/Middle East.
Table 3: U.S. Steel Imports by Source (2025)
Country
January–August 2025 Imports (short tons)
Market Share
YoY Change
Notes
Canada
6.2 million
33%
+8%
Benefited from U.S.-Canada trade agreements.
Mexico
3.8 million
20%
+12%
Proximity and NAFTA legacy.
Brazil
2.1 million
11%
-3%
Faced partial tariffs due to trade disputes.
China
150,000
<1%
-18%
Minimal due to tariffs and export restrictions.
5. Conclusion
The U.S. steel and aluminum tariffs in September–October 2025 marked a continuation of protectionist policies, with a focus on closing tariff loopholes through expanded derivative product coverage. While China’s direct exports to the U.S. remained limited, the policies disrupted global supply chains and accelerated China’s shift toward high-value production and regional trade alliances. The long-term impact will depend on whether the U.S. further escalates tariffs or engages in multilateral negotiations to resolve disputes. For businesses, navigating complex tariff classifications and diversifying supply chains will be critical to mitigate risks.
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