Trump Administration Section 232 Metal Tariff Revisions

Stephan E. Becker Sahar J. Hafeez Julian M. Beach In an April 2, 2026 Proclamation, the Trump administration made significant changes to the implementation of the existing tariffs on steel, copper, and aluminum products and derivative articles under Section 232 of the Trade Expansion Act (“Section 232”). Since June 2025, Section 232 duties on mixed metal and non-metal products have been calculated based on the value of the steel, aluminum or copper content within the article. This instruction to separate out metal versus non-metal content resulted in considerable confusion regarding the methodology to determine the price paid by the importer for steel or aluminum consistent with the principles of 19 U.S.C. 1401a.

Effective April 6, 2026, the Proclamation replaces this system with tariffs on the full customs value of imports, with different duty levels depending on HTSUS classification and the steel or aluminum intensity of the derivative article. The Administration also formally terminated the quarterly “inclusion processes” established last year for steel, aluminum and copper derivatives. Instead, the U.S. Trade Representative and Secretary of Commerce may consider requests to include additional derivatives on a case-by-case basis if they jointly determine that imports of such derivatives have increased in a manner that threatens national security.

The Proclamation and accompanying annexes provide the ad valorem tariff applicability (or non-applicability) for different buckets, subject to exceptions described further below:

• Products listed in Annex I-A to the Proclamation will be subject to a 50% section 232 duty on their full entered value, “with reduced rates available for certain products from the United Kingdom given the ongoing discussions and for derivative articles made entirely with metals originating from the United States.” This category generally applies to goods made entirely of the relevant metal, such as steel mill and pipe and tube products, aluminum wire, bar, plate, castings, and forgings, refined copper and copper alloys, and certain derivatives with higher-intensity metal content.
• Products listed in Annex I-B will be subject to a 25% section 232 duty on their full entered value. Annex I-B includes many of the derivative articles added in June and August 2025, including many articles of machinery under Chapters 84 and 85 and Chapter 86 and 87 steel-intensive industrial goods. These derivative products are the main focus of this change in methodology, as importers transition from complex calculations of metal content value to a baseline tariff on the entire entered value.
• Products listed in Annex II are removed from the list of steel and aluminum derivative articles altogether, and will no longer be subject to Section 232 duties.
• Products listed in Annex III will be subject to a 15% all-in MFN/Column 1 rate plus Section 232 duty applicable until December 2027 on their full entered value. The Proclamation describes this temporary reduction as an effort to secure machinery and technologies “essential to the United States defense industrial base,” including to expand domestic metal production.
  • Notably, Annex III also appears intended to implement the EU’s request to reduce tariff rates for steel and aluminum derivatives to 15% under the U.S.-EU Trade Framework Agreement. Bernd Lange, the chair of the European Parliament’s International Trade Committee, hailed the reduction to a 15% all-in tariff as a “ welcome first step ” toward implementation of the deal.
  • After December 2027, the rate will increase to 25% for these products. In addition, the Proclamation provides that if Commerce and USTR find that imports of derivative articles listed in Annex III increase in a manner that undermines the objectives of Section 232, products listed in Annex III from that trading partner will become subject to the tariff rate applicable to products under Annex I-B. The Proclamation also provides for reduced duties of (i) 10% for derivative articles, the metal content of which is composed entirely (at least 95%) of aluminum, steel or copper that was smelted and cast in the United States (for aluminum and copper) or melted and poured in the United States (for steel); and (ii) 25% for Annex I-A and 15% for Annex I-B for UK-origin products, the aluminum content of which is composed entirely (at least 95%) of aluminum that was smelted or most recently cast in the United Kingdom or the steel content of which is composed entirely of steel that was melted and poured in the United Kingdom. (CBP’s Customs instructions, available here, provide Chapter 99 HTS codes implementing each of these categories of melt and pour and smelt and cast duty reductions.)

The Proclamation and attached Annexes include other important exclusions and rules.

• Non-Stacking: Goods specified in Annex I-A, Annex I-B, and Annex III that are listed as articles or derivatives of more than one metal shall only be subject once to the duty rates provided above if they contain one or of the metals.
• Exclusion for low metal content: Articles listed in Annex I-B or Annex III, except for those that are classified in HTSUS Chapters 72, 73, 74, or 76, are not subject to Section 232 duties at all where the weight of the applicable metal is less than 15% of the weight of the imported product. If an article is classified in a provision subject to multiple lists (aluminum, steel, copper), importers are instructed to use the aggregate weight of the listed metals to determine the 15% threshold.

• In an important shift from the prior Section 232 regime, the Administration has made manufacturing drawback under 19 U.S.C. 1313 available for products that meet certain conditions:

  • Included in Annex 1-B or Annex III.
  • Not subject to an anti-dumping or countervailing duty order.
  • Products originating from Trade Agreement Partners, including the United Kingdom, the EU, Japan, Korea, Mexico, Canada and any country with a final Agreement on Reciprocal Trade (ARTs).
  • The relevant aluminum or copper was smelted and cast in a Trade Agreement Partner country and the steel content was melted and poured in a Trade Agreement Partner country. The availability of drawback under these circumstances offers a new advantage to countries with final ARTs, reflecting a recognition in the ARTs that these countries are taking steps to implement reciprocal trade and industrial policies aligned with the U.S.

• Foreign Trade Zones. As previously, products subject to Section 232 tariffs under the Proclamation admitted into a U.S. foreign trade zone on or after the April 6 may be admitted only under “privileged foreign status” under 19 CFR 146.41.
  **                 ***

These changes have important consequences for trade in steel, aluminum and copper, and for the supply chain of metal-intensive derivatives, including critical machinery and industrial goods. Importers should closely review the new Annexes and customs instructions to determine the new tariff treatment for relevant products, and be prepared to address nuances such as the exclusion for certain derivatives that have low levels of steel or aluminum content by weight.

The amendments to steel and aluminum duties also have broader ramifications for the implementation of the Administration’s trade framework agreements, most prominently the Turnberry accords under implementation by the EU, where Section 232 metal duties had emerged as a flashpoint. Finally, the changes appear to reflect Commerce and USTR’s consideration of many months of industry feedback regarding both the complexity and compliance burden of the previous tariff-by-metal-content-value approach, and the importance of certain imports, such as advanced machinery, for the U.S. industrial and manufacturing base.

RELATED ARTICLES

President Trump Initiates Section 232 Investigations into Pharmaceuticals, Semiconductors, Critical Minerals and Trucks

Share this:

- Print

Subscribe Email RSS

Recent Entries
- Trump Administration Revamps Section 232 Metal Duties, Bringing Clarity and New Complexity to Tariffs on Derivative Products
- OFAC Issues Broad Authorizations for Dealings with PdVSA
- OFSI Publishes Consultation Response and Updated Enforcement Guidance: Key Changes for UK Sanctions Enforcement