Metal Prices Climb Sharply as Tariff Jitters Spark Global Industry Pushback

U.S. President Donald Trump announced a doubling of tariffs on steel and aluminium imports to 50%, effective June 4, escalating trade tensions. This announcement followed accusations that China breached a prior agreement to roll back critical mineral-related tariffs.

The move led to immediate spikes in domestic U.S. steel and aluminium prices, while shares of foreign steelmakers declined sharply. The U.S., the largest global importer of steel (excluding the EU), imported 26.2 million tons in 2024, emphasizing the significance of this policy change.

Metal Prices Surge Amid Tariff Fears, Triggering Global Industry Backlash

Metal markets responded quickly: U.S. aluminium premiums rose 54%, and hot-rolled coil steel increased by 7.4%. Copper prices also surged on expectations of broader tariffs. Analysts noted that higher metal prices would likely hinder U.S. industrial activity, particularly manufacturing.

While skepticism remained about whether the tariffs would be fully implemented, the uncertainty alone was enough to influence market behavior. Goldman Sachs warned that U.S. steel demand could decline further this year due to the price shock.

European and Asian steelmakers voiced strong opposition. Germany’s Salzgitter stated the tariffs would severely damage European industry. The U.S. constitutes about 20% of non-EU European steel exports. In South Korea, the fourth-largest steel exporter to the U.S., shares of major producers like POSCO and Hyundai Steel fell.

The Industry Ministry held emergency meetings, reflecting fears that the tariff burden, without corresponding U.S. price increases, could hurt export-dependent businesses. Vietnamese steel stocks also dropped as exporters braced for reduced U.S. demand.

U.S. Producers Applaud Tariffs as Foreign Rivals Scramble Amid Trade Uncertainty

In contrast, U.S. aluminium and steel companies welcomed the tariffs. Mark Duffy of the American Primary Aluminum Association hailed the move as protection against subsidized foreign competition. Domestic steelmakers such as Nucor, Cleveland-Cliffs, and Steel Dynamics saw share prices soar by up to 24%.

Trump initially reimposed 25% tariffs upon taking office in January, with the current hike intensifying his protectionist stance. U.S. producers see this as a chance to rebuild local manufacturing and reduce reliance on foreign supply chains.

South Korea has pushed for exemptions through bilateral trade talks, but domestic political instability has slowed negotiations. Despite tariffs, companies like Hyundai Steel and POSCO are investing in U.S. infrastructure, including a $5.8 billion factory in Louisiana.

In India, another major exporter, aluminium industry leaders expressed concern about the potential loss of their biggest market. While hopes remain that diplomatic negotiations may ease the tariffs, uncertainty looms large for global supply chains and export-driven economies.