The United States has postponed imposing Section 232 tariffs on steel and aluminium imported from the European Union, Canada and Mexico until June 1.
President Donald Trump's administration announced the extension of temporary exemptions for the key trading blocs at the last moment on Monday April 30. A 10% import tax on aluminium and a 25% import tax on steel were due to come into effect on Tuesday.
“The administration is extending negotiations with Canada, Mexico and the European Union for a final 30 days. In all of these negotiations, the administration is focused on quotas that will restrain imports, prevent transshipment and protect the national security,” the White House said in a statement.
The administration has agreed to permanent exemptions from tariffs for Australia, Brazil and Argentina it said, without disclosing further details.
US physical markets at multiyear highs
The physical market reaction to tariffs has been for spot prices to rise sharply.
The US is a major importer of both steel and aluminum; although domestic production is expected to be boosted as a result of import restrictions, and metal for nearby delivery has been priced up considerably.
US Midwest delivered premiums for P1020 commodity grade aluminium have risen by 135% since the start of the year and were averaging 22.25 cents per lb as of April 27.
US hot-rolled coil (HRC) prices remain close to their highest levels in seven years and have risen 16% since US Secretary of Commerce Wilbur Ross filed a January 19 report to the US president recommending the imposition of tariffs.
American Metal Market's hot-rolled coil index was last assessed at $43.21 per hundredweight ($864.20 per tonne) on April 26.
The US had already agreed on a tariff exemption with South Korea, which accepted a quota system for its steel exports to the US.