The United States will announce plans to impose tariffs on steel and aluminium from the European Union as early as Thursday morning, two people briefed on the matter said, confirming a report in the Wall Street Journal.

The decision would land ahead of a Friday expiration deadline for exemptions to the planned metals tariffs amid stalled trade talks with the EU and would likely prompt retaliation from the bloc.

The two sources said an announcement was planned for Thursday morning in Washington but that the timing could still change.

The US Commerce Department and US Trade Representative’s Office did not immediately respond to requests for comment.

President Donald Trump on March 23rd imposed a 25 per cent tariff on steel imports and a 10 per cent tariff on aluminium, but granted temporary exemptions to the EU, Canada, Mexico, Brazil, Australia and Argentina.

Trump invoked a 1962 trade law to erect protections for US steel and aluminium producers on national security grounds, amid a worldwide glut of both metals that is largely blamed on excess production in China.

The European Commission, which coordinates trade policy for the 28 EU members, has said the bloc should be permanently exempted from the tariffs since it was not the cause of overcapacity in steel and aluminium.

The Commission has said the EU will set duties on €2.8 billion of US exports, including peanut butter and denim jeans, if its metals exports to the United States worth €6.4 billion are subject to tariffs.

The tariffs, which have increased friction with US trading partners worldwide and prompted several challenges before the World Trade Organization, are aimed at allowing the US steel and aluminium industries to increase their capacity utilization rates above 80 per cent for the first time in years.

Economists say the standoff with the EU could tip toward a trade war, particularly after Trump last week launched another national security investigation into car and truck imports that could lead to new US tariffs.

The Trump administration has given permanent metals tariff exemptions to several countries including Australia, Argentina and South Korea, but in each case set import quotas.

Friday’s deadline for exemptions also affects Mexico and Canada, which are in contentious negotiations with the United States on the North American Free Trade Agreement that Trump has said he wants to revamp, or abandon if the talks fail. – Reuters </s> The United States has agreed to lift its tariffs on steel and aluminum imports from Canada and Mexico.

The move, which removes a major obstacle to renegotiating the North American Free Trade Agreement (NAFTA), will be implemented by Sunday afternoon, officials said.

President Donald Trump had imposed the tariffs — 25% on steel and 10% on aluminium imports — in March 2018 on national security grounds, saying the US market was being flooded with cheap imports from other countries, particularly China.

Under this weekend's agreement Canada and Mexico will also eliminate retaliatory tariffs on US products including cheese, milk and bourbon.

Canadian Prime Minister Justin Trudeau said it would open the way to further talks on a revised free trade deal.

"Obviously, these continued tariffs on steel and aluminum and our countermeasures, represented significant barriers to moving forward with the new NAFTA agreement," he said on Friday.

"Now that we've had a full lift on these tariffs, we are going to work with the United States on timing for ratification, but we're very optimistic we're going to be able to move forward move forward well in the coming weeks."

Speaking in Washington, Trump said he was now hopeful NAFTA could be replaced with the new U.S.-Mexico-Canada Agreement (USMCA).

"That deal is going to be a fantastic deal for our country and hopefully Congress will approve the USMCA quickly, and then the great farmers and manufacturers and steel plants will make our economy even more successful than it already is, if that's possible, which it is possible," he said. </s> WASHINGTON/PARIS (Reuters) - Canada and Mexico retaliated against the United State’s decision on Thursday to impose tariffs on steel and aluminium imports and the European Union had its own reprisals ready to go, reigniting investor fears of a global trade war.

The tariffs, announced by U.S. Commerce Secretary Wilbur Ross in a telephone briefing on Thursday, ended months of uncertainty about potential exemptions and suggested a hardening of the Trump administration’s approach to trade negotiations.

The measures, touted by President Donald Trump in March, drew condemnation from Republican lawmakers and the country’s main business lobbying group and sent a chill through financial markets.

The Dow Jones Industrial Average .DJI lost 1 percent and the S&P 500 .SPX shed around 0.66 percent. Shares of industrial heavyweights Boeing (BA.N) fell 1.7 percent and Caterpillar (CAT.N) 2.2 percent.

A 25 percent tariff on steel imports and 10 percent tariff on aluminium imports will be imposed on the EU, Canada and Mexico from midnight (0400 GMT on Friday), Ross told reporters.

“We look forward to continued negotiations, both with Canada and Mexico on the one hand, and with the European Commission on the other hand, because there are other issues that we also need to get resolved,” he said.

Canada and Mexico, embroiled in talks with the United States to modernize the North American Free Trade Agreement (NAFTA), responded swiftly.

Canada, the largest supplier of steel to the United States, will impose tariffs covering C$16.6 billion ($12.8 billion) on imports from the United States, including whiskey, orange juice, steel, aluminium and other products, Canadian Foreign Minister Chrystia Freeland said.

“The American administration has made a decision today that we deplore, and obviously is going to lead to retaliatory measures, as it must,” Prime Minister Justin Trudeau said at a news conference with Freeland.

Mexico announced what it described as “equivalent” measures on a wide range of U.S. farm and industrial products.

The measures, which target pork legs, apples, grapes and cheese as well as steel and other products, will be in place until the U.S. government eliminates its tariffs, Mexico’s Economy Ministry said.

The S&P 500’s packaged foods and meats industry sub-index .SPLRCFOOD fell 2 percent, with shares of meat producer Tyson Foods Inc (TSN.N) falling 4 percent, Campbell Soup Co (CPB.N) 2.5 percent and spice maker McCormick & Co Inc (MKC.N) 3 percent.

The Mexican peso MXN= dropped about 1 percent and the Canadian dollar CAD= shed about 0.6 percent. At its low, the peso was at its weakest against the dollar in nearly 15 months.

The EU threatened tariffs on Harley Davidson motorcycles and bourbon, measures aimed at the political bases of U.S. Republican legislators. Shares of Harley-Davidson Inc (HOG.N) fell 2.17 percent and Brown-Forman Corp (BFb.N), maker of Early Times and other bourbon brands, lost 2.1 percent. EU members have given broad support to a European Commission plan to set duties on 2.8 billion euros ($3.4 billion) of U.S. exports if Washington ends tariff exemptions. EU exports potentially subject to U.S. duties are worth 6.4 billion euros ($7.5 billion).

“It’s entirely up to U.S authorities whether they want to enter into a trade conflict with their biggest partner, Europe,” France’s Finance Minister Bruno Le Maire said after meeting with Ross on Thursday.

U.S. Chamber of Commerce President Tom Donohue warned in a letter seen by Reuters to the body’s board that current trade policies could threaten “economic progress” and cause the loss of more than 2 million jobs, mostly in states that voted for Trump and Republican candidates.

The tariffs are part of Trump’s effort to protect U.S. industry and workers from what he described as unfair international competition, a key theme of his “America First” agenda.

Temporary exemptions were granted to a number of nations and permanent ones to several countries including Australia, Argentina and South Korea. U.S. trading partners had demanded that the exemptions be extended or made permanent.

The tariffs are aimed at allowing the U.S. steel and aluminium industries to increase their capacity utilization rates above 80 percent for the first time in years.

Shares of U.S. Steel Corp (X.N) rose 1.7 percent, but AK Steel (AKS.N) fell 1.3 percent and Steel Dynamics Inc (STLD.O) shed 0.9 percent. Shares of Century Aluminum Co (CENX.O) jumped 3.3 percent but Alcoa Corp (AA.N) shed 0.9 percent.

The U.S. administration also launched a national security investigation last week into car and truck imports, using the same 1962 law it has applied to curb incoming steel and aluminium.

“The Trump administration seems to regard overt threats, including tariffs and repudiation of previous agreements, as a key element for gaining leverage in trade negotiations,” said Eswar Prasad, a former head of the International Monetary Fund’s China division and now a professor at Cornell University.

Prasad warned that the United States was doing so at the cost of alienating key allies and undercutting broad international pressure on China to change its trade and economic practices.

Ross himself heads to Beijing on Friday where he will attempt to get firm deals to export more U.S. goods in a bid to cut America’s $375 billion trade deficit with China.

The Trump administration has demanded that Beijing make concessions and threatened to punish it for allegedly stealing U.S. technology by imposing tariffs on $50 billion of imports from China.

While China is seen at more risk from a trade war as its exports are larger than its imports from the U.S., the operations of American companies in China make substantial sales there, which could be hit by any turn in sentiment. ($1 = 0.8575 euros) </s> President Trump is imposing steep tariffs on steel and aluminum from three of America's biggest trading partners — Canada, Mexico and the European Union.

The trade penalties, 25% on imported steel and 10% on imported aluminum, take effect at midnight, Commerce Secretary Wilbur Ross told reporters Thursday.

The announcement immediately raised the risk of retaliatory tariffs against American products.

Trump announced worldwide steel and aluminum tariffs in March but granted exemptions to some major trading partners.

Canada, Mexico and the EU were among the countries granted relief while the United States pursued negotiations to address the administration's concerns about the state of domestic steel and aluminum production. Those negotiations had a Friday deadline.

Trump's decision could raise prices for Americans on a range of everyday products. It could also place the United States in a trade dispute on more than one front. The administration is separately moving ahead with tariffs on Chinese goods.

Trump imposed the steel and aluminum penalties under a 1962 law that gives the president broad power to increase or reduce tariffs on goods deemed critical to national security.

"We take the view that without a strong economy, you cannot have strong national security," Ross told reporters.

Trump's announcement lifted American steel and aluminum stocks because those companies stand to benefit from penalties against their foreign competitors. U.S. Steel climbed 3%. But the broader market sank because of trade war fears. The Dow fell about 200 points.

Europe had promised swift retaliation if it was hit with the trade penalties, and had warned it could quickly respond with 25% tariffs on US products such as motorcycles, denim, cigarettes, cranberry juice and peanut butter.

Getting rid of the exemptions for Canada and Mexico, meanwhile, could complicate ongoing negotiations on NAFTA. Canada had also pledged to retaliate.

"Should restrictions be imposed on Canadian steel and aluminum products, Canada will take responsive measures to defend its trade interests and workers," Canadian Foreign Minister Chrystia Freeland said in March.

The NAFTA talks were one factor in the administration's decision to grant exemptions to Canada and Mexico from the steel and aluminum tariffs. But Ross said Thursday that those talks "are taking longer than we hoped."

Related: The global steel industry by the numbers

Canada was the largest exporter of steel to the United States by value last year, according to data from Wood Mackenzie. Mexico was the third largest, behind South Korea.

The Trump administration said Tuesday that it is moving forward with tariffs on $50 billion worth of Chinese goods as punishment for intellectual property theft.

The Chinese government said the announcement was "obviously in violation of the consensus reached in Washington recently by both China and the United States." Both parties had previously said that tariffs would be put on hold as talks continued.

Ross is scheduled to go to China this weekend for a third round of negotiations.

The United States is also exploring the possibility of putting new tariffs on cars. Last week, The Trump administration announced an investigation into whether automobile imports are hurting US national security, laying the groundwork for another trade fight.

Such an action could hurt Mexico, Canada, Germany and Japan.

— CNNMoney's Alanna Petroff, Nathaniel Meyersohn and Matt Egan contributed to this report. </s> • The Trump administration started imposing tariffs on European, Canadian, and Mexican steel and aluminum on Friday morning.
• Canada called it an “affront”, the UK said it was “patently absurd”, and the French compared it to a cowboy shoot-out.

US allies have been responding furiously to the Trump administration’s decision to impose steep tariffs on their steel and aluminum exports as part of an escalating trade war.

Starting Friday, steel imports from those countries will be hit with a 25% tariff, while aluminum imports will be hit with a 10% tariff. Tariffs are essentially taxes on foreign goods coming into a country – (you can read more about how that works here).

The Trump administration’s move is meant to be a show of support to the US steel and aluminum industries from foreign producers that undercut domestic prices. The White House previously said that protecting those industries was a matter of national security, although many experts have questioned that justification.

Here’s how European nations, Canada, and Mexico, have reacted to Trump’s latest move.

UK Trade Secretary Liam Fox on Friday slammed the tariffs as a “patently absurd” move, and that UK government is considering counter-measures.

Barry Gardiner, a trade spokesman for the opposition Labour party, said: “We will not be cowed, we will not be bullied by the President. The President has said he believes he could win a trade war. We think a trade war is in nobody’s interests. It’s not in our interests, it’s not in the EU’s interests, and it’s not in the interest of American workers.”

The EU handles trade policy for its 28 member states, many of which also responded separately, including Brit ian, Germany, and France.

Commission President Jean-Claude Juncker has threatened to hit back at the US with EU tariffs on equal value, telling reporters on Thursday: “It’s totally unacceptable that a country is imposing unilateral measures when it comes to world trade.”

The EU previously released a list of US products that would be subject to tariffs in the event the metal restrictions went into effect. It included blue jeans, motorcycles, boats, bourbon whiskey, rice, playing cards, and steel.

France: This is like the OK Corral

Bruno Le Maire, France’s finance minister, echoed Juncker’s warnings by saying: “Our US friends must know that if they were to take aggressive actions against Europe, Europe would not be without reaction.”

Le Maire added: “World trade is not like the settling of accounts at the OK Corral,” referring to a 30-second shootout between a law-and-order gang and a group of cowboys in Tombstone, Arizona, in 1881.

Prime Minister Justin Trudeau described the move as “totally unacceptable” and an “affront to the thousands of Canadians who have fought and died alongside their American brothers in arms.”

He also described the tariff impositions as “illegal and counterproductive” under NAFTA and WTO rules, and that Trump’s national security justification was “simply ridiculous.”

Trudeau added that Canada would impose “dollar for dollar tariffs” on US products, including steel and aluminum from July 1, which would remain in place until the US lifted its own tariffs. Other US consumer products that could be hit include maple syrup, pizza, and toilet paper.

Canadian Foreign Minister Chrystia Freeland told reporters that Canada’s retaliatory tariffs were “strongest action by Canada in the post-War era.”

Mexico: Let’s keep it in proportion.

Mexican Economy Minister Ildefonso Guajardo described the new landscape as a “clearly defined battlefield,” but not a trade war. He also vowed that the country would take revenge proportionally.

He told Mexican radio on Thursday, as cited by Reuters: “A trade war is when there is an escalation of conflict. In this case, it is simply a response to a first action.

“We should stick to the clearly defined battlefield, where the response is appropriate and proportional.”

In a separate statement on Thursday, the Mexican government also called Trump’s new tariffs “measures that affect and distort international commerce in goods,” and that they were “neither adequate nor justified,” according to The Hill.

It said it would “impose equivalent measures” on US goods including foil, lamps, pork legs and shoulders, apples, and cheese.

Germany: No insults, but trying to fix it.

The country’s economic minister, Peter Altmaier, said his country would stand with the EU and even work “more closely” with Mexico and Canada, who were also hit by the trade war.

Altmaier told German TV on Friday, according to Reuters: “We tried to do it through negotiation and we will now do it by standing together and formulating a common European answer, possibly working more closely with Mexico and Canada.”

What the US says

US Commerce Secretary Wilbur Ross, who announced the tariffs, said on Thursday that there was “nothing weird” about the countries’ reactions, and that they “will get over that in due course.” </s> The European Union will impose counter measures after the United States decided to no longer exempt it from steel and aluminium tariffs, the head of the bloc's executive Jean-Claude Juncker said on Thursday.

The United States said it was moving ahead with tariffs on 

 aluminium and steel imports from Canada, Mexico and the EU, 

 ending a two-month exemption and potentially setting the stage 

 for a trade war with some of America's top allies.

"This is a bad day for world trade," Juncker said in a speech in Brussels. "So we will immediately introduce a settlement dispute with the WTO and will announce counter balancing measures in the coming hours."

"It is totally unacceptable that a country is imposing unilateral measures when it comes to world trade."

Responding to the announcement, a spokesman for the UK government said: "We are deeply disappointed that the US has decided to apply tariffs to steel and aluminium imports from the EU on national security grounds.

"The UK and other European Union countries are close allies 

 of the US and should be permanently and fully exempted from 

 the American measures on steel and aluminium." </s> The US President Donald Trump on Thursday formally signed proclamations to impose steep tariffs on imported steel and aluminum amid mounting dissent from business groups and trading partners around the world. The US will impose a 25 per cent tariff on imported steel and 10 per cent on aluminum, Xinhua quoted Trump as saying. He said this at an event at the White House, noting a strong steel and aluminum industry is “vital to our national security.”

The tariffs will take effect in 15 days with initial exemptions for Canada and Mexico pending the renegotiation of the North American Free Trade Agreement (NAFTA). “We’re going to hold off the tariff on those two countries, to see whether or not we’re able to make the deal on NAFTA,” Trump said.

Trump signaled that all other countries also have opportunities to be exempt from the tariffs by negotiations with the United States. “If the same goals can be accomplished by other means, America will remain open to modifying or removing the tariffs for individual nations, as long as we can agree on a way to ensure that their products no longer threaten our security,” he said. </s> Thursday, May 31, 2018 at 3:22 am |

President Donald Trump’s administration is planning to impose tariffs on European steel and aluminum imports after failing to win concessions from the European Union, a move that could provoke retaliatory tariffs and inflame trans-Atlantic trade tensions.

The tariffs are likely to go into effect on the EU with an announcement by Friday’s deadline, according to two people familiar with the discussions. The administration’s plans could change if the two sides are able to reach a last-minute agreement, said the people, who spoke on condition of anonymity to discuss internal deliberations.

Trump announced in March the United States would slap a 25 percent tariff on imported steel, and a 10 percent tariff on imported aluminum, citing national security interests. But he granted an exemption to the EU and other U.S. allies; that reprieve expires Friday.

Europe has been bracing for the U.S. to place the restrictions even as top European officials have held last-ditch talks in Paris with American trade officials to try to avert the tariffs.

“Realistically, I do not think we can hope” to avoid either U.S. tariffs or quotas on steel and aluminum, said Cecilia Malmstrom, the European Union’s trade commissioner. Even if the U.S. were to agree to waive the tariffs on imported steel and aluminum, Malmstrom said, “I expect them nonetheless to want to impose some sort of cap on EU exports.”

European officials said they expected the U.S. to announce its final decision Thursday. The people familiar with the talks said Trump could make an announcement as early as Thursday.

U.S. Commerce Secretary Wilbur Ross attended meetings at the Organization for Economic Cooperation and Development in Paris on Wednesday, and U.S. Trade Representative Robert Lighthizer joins discussions in Paris on Thursday.

The U.S. plan has raised the threat of retaliation from Europe and fears of a global trade war — a prospect that is already weighing on investor confidence and could hinder the global economic upturn.

If the U.S. moves forward with its tariffs, the EU has threatened to impose retaliatory tariffs on U.S. orange juice, peanut butter and other goods in return. French Finance Minister Bruno Le Maire pledged that the European response would be “united and firm.”

Besides the U.S. steel and aluminum tariffs, the Trump administration is also investigating possible limits on foreign cars in the name of national security.

“Unilateral responses and threats over trade war will solve nothing of the serious imbalances in the world trade. Nothing,” French President Emmanuel Macron said in an impassioned speech at the Organization for Economic Cooperation and Development in Paris.

In a clear reference to Trump, Macron added, “These solutions might bring symbolic satisfaction in the short term. … One can think about making voters happy by saying, ‘I have a victory, I’ll change the rules, you’ll see.'”

But, Macron said, those “who waged bilateral trade wars … saw an increase in prices and an increase in unemployment.”

Tariffs on steel imports to the U.S. can help local producers of the metal by making foreign products more expensive. But they can also increase costs more broadly for U.S. manufacturers who cannot source all their steel locally and need to import the raw material. That hurts the companies and can lead to more expensive consumer prices, economists say.

Ross criticized the EU for its tough negotiating position.

“There can be negotiations with or without tariffs in place. There are plenty of tariffs the EU has on us. It’s not that we can’t talk just because there’s tariffs,” he said. He noted that “China has not used that as an excuse not to negotiate.”

But German Economy Minister Peter Altmaier insisted the Europeans were being “constructive” and were ready to negotiate special trade arrangements, notably for liquefied natural gas and industrial goods, including cars.

Macron also proposed to start negotiations between the U.S., the EU, China and Japan to reshape the World Trade Organization to better regulate trade. Discussions could then be expanded to include other countries to agree on changes by the end of the year.

Ross expressed concern that the Geneva-based World Trade Organization and other organizations are too rigid and slow to adapt to changes in global business.

“We would operate within [multilateral] frameworks if we were convinced that people would move quickly,” he said.

Ross and Lighthizer seemed like the odd men out at this week’s gathering at the OECD, an international economic agency that includes the U.S. as a prominent member.

The agency issued a report Wednesday saying “the threat of trade restrictions has begun to adversely affect confidence” and tariffs “would negatively influence investment and jobs.” </s> The Trudeau government has retaliated against a 25% U.S. tariff imposed this morning on Canadian steel and aluminum by levying similar tariffs on U.S. steel and aluminum coming into this country. The counter-measures go into effect on July 1st and will stay in place until the U.S. drops its tariffs, according to Foreign Affairs minister Chrystia Freeland.
United States tariffs of 25% on steel and 10% on aluminium imports from Canada, Mexico and the European Union are set to take effect at midnight.