Trump Administration Reportedly Plans to Adjust Steel and Aluminum Tariffs, Unifying Tariffs on Steel and Aluminum Products at 25%, Allegedly Raising Import Costs

Recent reports indicate that the Trump administration is preparing a significant adjustment to its steel and aluminum tariff system, which would impose a uniform 25% tariff on "derivative products" containing steel and aluminum, replacing the current complex and cumbersome calculation method. This policy adjustment is seen as an attempt by the U.S. government to ease compliance pressure on businesses while maintaining trade protection, but it could also trigger new shocks to global trade relations and industrial chains. On Wednesday, April 1st, Eastern Time, U.S. media cited sources familiar with the matter, stating that the new steel and aluminum tariff policy could be announced as early as this week. The new policy will stipulate that all finished products using imported steel and aluminum will be subject to a 25% tariff. The current policy requires companies to calculate the tax burden based on the steel and aluminum content of their products, with a maximum applicable tariff rate of up to 50%. Following the news, sentiment in the industrial metals and manufacturing sectors diverged. Alcoa (AA), which closed up 8.6% on Wednesday, turned lower in after-hours trading, falling about 2% at one point. Overall, this tariff adjustment appears to be more of a "technical optimization" of existing trade protection policies rather than a directional shift. The United States continues to use tariffs to protect its domestic industries but is beginning to transition to a "more operable and more certain" framework at the execution level. However, against the backdrop of a tightening global trade environment and escalating geopolitical competition, even a "simplified rules" adjustment could trigger chain reactions across supply chains and in diplomatic spheres. The specific details of the future policy implementation, along with responses from various countries, will be key areas of market focus. Tariff Structure "Simplified": From Complex Calculation to Unified Rate The core of the steel and aluminum tariff adjustment mentioned in reports this week is the shift from the original "taxation based on content" complex system to a more direct, unified tax rate. Under current rules, when the U.S. imposes tariffs on certain steel and aluminum-containing products, companies must accurately calculate the proportion of these metals and pay taxes up to 50% based on that calculation. This system has been widely criticized for increasing corporate compliance costs and complicating supply chain management. The new plan proposes to adopt a "taxation based on finished products" approach, directly imposing a 25% tariff on all related derivative products. Analysts believe this change has two implications: Reduced Compliance Costs: Companies will no longer need to break down material sources or proportions. Enhanced Policy Enforceability: Decreased reporting disputes and regulatory difficulties. However, it is important to note that for products "almost entirely composed of steel or aluminum," the original higher tax rates may still apply. Policy Intent: Seeking Balance Between Protection and Economic Pressure The Trump administration's previous imposition of high tariffs on steel and aluminum products primarily aimed to address global overcapacity, particularly targeting steel exports from major Asian countries. However, the policy had significant spillover effects, impacting allies including Canada, the European Union, Mexico, and South Korea. This adjustment, to some extent, reflects the practical pressures faced by policymakers. At the corporate level, U.S. manufacturers have long complained about complex tariff rules and rising costs. At the political level, inflation and the pressure of living costs are eroding voter support. Media outlets point out that with midterm elections approaching, economic issues are becoming critical variables, and the government intends to alleviate dissatisfaction among businesses and consumers by optimizing policy details. Market and Supply Chain Impact: Uncertainty Remains High Although the tariff rate is adjusted from a maximum of 50% (based on content) to a unified 25%, commentators believe this does not signify a substantial weakening of trade protection. On one hand, for companies that previously struggled to accurately calculate metal content, the tax burden may become more certain or even increase. On the other hand, unified taxation could broaden the scope of application, bringing more products under the tariff system. Potential impacts include: Global Supply Chain Restructuring: Companies may accelerate adjustments to their procurement and production layouts. Risk of Escalating Trade Friction: Allied nations may express dissatisfaction or even retaliate against new measures. Increased Metal Price Volatility: Markets will reprice expectations for demand and costs.