Stacked tariffs could push import costs higher as market tightens

China’s overcapacity is the primary target, but the European Union, Singapore, Switzerland, Norway, Indonesia, Malaysia, Cambodia, Thailand, Korea, Vietnam, Taiwan, Bangladesh, Mexico, Japan, and India are also in the crosshairs, particularly for their indirect steel imports.

Per an April 2025 presidential executive order, Section 232 and Section 301 tariffs can be stacked, or combined. This means the countries under investigation could see even higher tariff rates on top of the current 50% Section 232 duties.

Section 301 tariffs target specific industries and products. That means all steel products could face additional tariffs, or only specific product categories.

“It remains to be seen how expansive the administration will be,” Philip K. Bell, CAE, president and CEO of the Steel Manufacturers Association (SMA), told SMU. The Trump administration eventually expanded Section 232 duties to include derivatives, he noted.

He also pointed out that the stacking of tariffs is “highly subjective.” The administration could allow stacking, then later decide to discontinue it.

“When it comes to this administration, you really take a wait-and-see approach,” Bell commented. He highlighted that, when it comes to the steel trade, the Trump administration has committed significant resources and is moving at a very good pace. “They don’t waste time,” he noted.

US producers press for new 301 actions

Realizing how much is at stake for imports and domestic manufacturing, steel producers and trade groups packed a Section 301 hearing in early May to discuss structural excess capacity. Industry witnesses told USTR that global steel overcapacity continues to undercut US producers despite existing trade actions.

U.S. Steel’s Ben Caryl said indirect steel trade is masking the true scale of global overcapacity. He noted the US imported $1.9 trillion in steel-intensive goods last year and said including downstream products in demand calculations “will unmask an additional over 100 million tons of China’s excessive steel overcapacity.”

Nucor’s Anna Ehrich said global steel overcapacity reached 640 million mt in 2025 and is projected to exceed 721 million mt by 2027. She noted China exported 119 million mt last year, depressing global prices and displacing production into the US market. She warned that any new measures must avoid disrupting imports of critical raw materials such as pig iron and DRI.

A representative for Eramet Marietta described severe pressure on the domestic manganese ferroalloy sector from low-priced imports from India and Malaysia. He said those imports have pushed the company’s utilization “significantly below the 80% threshold” needed for a healthy steel industry. He urged targeted 301 tariffs on ferroalloys.

Roy Houseman of the United Steelworkers said structural excess capacity “impacts not just the worker on the shop floor, but the entire ecosystem connected to that factory.” He called for durable 301 actions paired with strong anticircumvention enforcement.

Steel Dynamics’ counsel said Korea’s steel capacity exceeds domestic demand by nearly 20 million tons and reiterated that Korean exports to the US remain strong despite 232 and AD/CVD duties. SDI also urged cumulative 301 measures.

SMA’s Brandon Farris, VP of government affairs, said the US imported 200 million tons more steel than it exported over the past decade. He called Section 301 “an appropriate and necessary tool” to confront rising global capacity.

The American Iron and Steel Institute (AISI) said China exported 131 million tons of steel in 2025 – “more steel than North America used.” AISI’s Jeremy Hekhuis, SVP for public policy and general counsel, urged cumulative tariffs to counter “market-damaging global distortions.”

Pipe and tube

The pipe and tube sector has been hard hit by unfairly traded imports, “probably harder than most other product categories,” according to Bell. P&T manufacturers didn’t hold back at the hearing, with several sector groups providing testimony in favor of targeted measures.

Roger Schagrin, representing the Committee on Pipe and Tube Imports (CPTI), said China’s excess steel capacity “is solely the result of Chinese government policies which violate Section 301.” He warned that in many pipe and tube products, “Chinese excess capacity alone can supply the entire world demand.”

Schagrin said Korea remains the top OCTG exporter to the US despite having “no oil or natural gas.” He said US pipe and tube imports rose by 300,000 tons in 2025, driven partly by “massive fraudulent underreporting of customs values.” CPTI urged USTR to “stack 301 relief… on top of the 232 relief,” especially for Korea.

The US OCTG Manufacturers Association (USOMA) said China’s OCTG overcapacity is so large that producers “transshipped over 300,000 tons” through Thailand to evade US duties. They said countries with little or no drilling activity – including Korea, Austria, and Taiwan – have built export-oriented OCTG industries aimed almost entirely at the US.

The American Line Pipe Producers Association said domestic large-diameter welded pipe mills are running “at less than 50% capacity utilization” due to global overcapacity. ALPPA asked USTR to include the pipe in any 301 measures.

The Steel Tube Institute (STI) reported that imported steel conduit prices were “20 to 30%” below domestic product prices, citing misclassification and evasion. It urged targeted tariff action on conduit from China, Vietnam, Thailand, Korea, Mexico, and India.

Mexican producers press against 301 action

While domestic players pressed for targeted Section 301 action, representatives of Mexican steelmakers expressed their concerns about the additional tariffs.

Canacero’s Sergio de la Maza said Mexico is not contributing to global overcapacity and should be treated as a partner. He said Mexico’s policies target non-FTA steel and that Mexico should be “part of the solution.”

A representative for Mexican long-product producer Deacero argued that Mexico does not have structural excess capacity. He said Mexico imports 11 million tons of steel annually and that the US holds a $4-billion steel trade surplus with Mexico. Additional 301 measures, he said, would “undermine the spirit of the USMCA” and disrupt integrated North American supply chains.

The import numbers

Many of the countries targeted in these 301 investigations are major suppliers of flat-rolled steel products to the US, including South Korea, Taiwan, Japan, Mexico, Vietnam, and the EU.

South Korea, for example, is the top foreign supplier of cut-to-length plate, and the number two supplier of hot-rolled, cold-rolled, and galvanized sheet, and coiled plate, according to US import statistics.

Steel import offers from Korea are typically very competitive. And in this new tariff paradigm, Korean mills have leveraged that competitiveness by increasing their exports to the US market: so far this year, Korea has surpassed Canada, Mexico, and Brazil each month as the top origin for foreign steel entering the US.

In the first four months of this year, steel imports from Korea averaged 266,135 metric tons (mt) per month, compared with 217,096 mt per month in the same period last year. Comparatively, Canada, previously a top supplier, has sent a monthly average of 226,231 mt this year vs. 466,933 mt last year.

Why it’s important

It’s important to keep an eye on developments in imports and tariffs, as they could further impact the domestic market, which is already experiencing extended lead times and elevated prices.

“With the US being a net importer, we are still reliant on imports to keep the market balanced,” Matthew Abrams, senior finished steel analyst at CRU, told SMU.

The precipitous decline in steel imports since Section 232 tariffs were raised to 50% has helped drive the current tight market and high prices we’re seeing domestically, he said.

“If Section 301 does stack, that would just amplify what’s going on currently and lead to higher landed import costs and supporting an even higher domestic price,” Abrams noted.

Bell agreed that stacking would impact prices, “but hopefully what it will also do is impact behavior.”

Domestic producers are prepared to fill the gaps left by reduced imports, according to AISI. “American steel producers are confident in their ability to meet the nation’s steel demand, and they stand ready to support the customers, industries and infrastructure projects that depend on domestic steel production,” AISI President and CEO Kevin Dempsey told SMU.

What’s next

Now that the public comment period and the hearing are over, the US Trade Representative will rule whether the economies under investigation warrant action under Section 301. If they rule in the affirmative, USTR must decide what action is appropriate to take for each country, i.e., the magnitude and scope of the 301 tariffs.

Although USTR has a year from initiation to render its decision, many expect a decision before the expiration of the 10% Section 122 global universal tariff on July 24.