Doubled US metals tariffs kick in as deadline for 'best offers' arrives

European businesses called on the European Commission, which handles trade talks for the 27-nation EU to do everything it can to remove the tariffs, as the bloc's trade negotiator Maros Sefcovic met with U.S. Trade Representative Jamieson Greer in Paris in the morning.

Sefcovic said he "had a productive and constructive discussion" with Greer, without giving any detail on the talks.

"We're advancing in the right direction at pace - and staying in close contact to maintain the momentum," Sefcovic said on X.

Late on Tuesday, Trump signed an executive proclamation that activates from Wednesday a hike in the tariffs on imported steel and aluminium to 50% from the 25% rate introduced in March.

"We started at 25 and then after studying the data more, realized that it was a big help, but more help is needed. And so that is why the 50 is starting tomorrow," White House economic adviser Kevin Hassett told a steel industry conference in Washington on Tuesday. The increase came into effect at 12:01 a.m. (0401 GMT).

The increase applies to all trading partners except Britain, the only country so far to strike a preliminary trade agreement with the U.S. during a 90-day pause on a wider array of Trump tariffs. The rate for steel and aluminium imports from the UK - which does not rank among the top exporters of either metal to the U.S. - will remain at 25% until at least July 9.

The increase in the levies jolted the market for both metals this week, especially for aluminium, which has seen price premiums more than double this year. With little capacity to increase domestic production, U.S. import volumes are likely to be unaffected unless the price increases undercut demand.

'BEST OFFER' DUE DATE

Wednesday is also when the White House expects trading partners to propose deals that might help them avoid Trump's hefty "reciprocal" tariffs on imports across the board from taking effect in five weeks.

U.S. officials have been in talks with several countries since Trump announced a pause on those tariffs on April 9, but so far only the UK deal has materialised and even that pact is essentially a preliminary framework for more talks.

Reuters reported on Monday that Washington was asking countries to list their best proposals in a number of key areas, including suggested tariffs and quotas for U.S. products and plans to remedy any non-tariff barriers.

In turn, the letter promises answers "within days" with an indication of a "landing zone," including what tariff rates countries can expect after the 90-day pause ends on July 8.

At issue for most trading partners is whether they retain the current baseline rate of 10% on most exports to the U.S. after that date, or something possibly much higher.

HAVOC FOR BUSINESSES

Uncertainty around U.S. trade policy is creating havoc for businesses around the world, including in Europe.

On Wednesday, French spirits group Remy Cointreau abandoned its 2030 sales growth ambitions, saying tariffs, slow U.S. sales and high uncertainty could derail its plans for this financial year and beyond.

Austrian speciality steelmaker Voestalpine also warned that tariffs were likely to dent its earnings, while German engineering lobby group VDMA blamed uncertainty caused by Trump's tariffs for a 6% drop in orders its members reported in May.

"U.S. producers will try to find suppliers that are not affected by the tariffs. If they find one, the German supplier is probably out," said German steel and metal processing association WSM, which represents around 5,000 companies.

"If they don't find one because the part is too special, the gruelling struggle over the added costs begins," said WSM Managing Director Christian Vietmeyer.

"Nobody has the margins to absorb these bottomless tariffs," Vietmeyer said, adding: "The EU must therefore do everything it can to resolve this customs conflict."

CLOSEST PARTNERS

The United States imports about a quarter of all its steel, and Census Bureau data shows the increased tariffs will hit the closest U.S. trading partners - Canada and Mexico - especially hard.

Canada will be even more exposed to the aluminium levies since it exports to the U.S. roughly twice as much as the rest of the top 10 exporters' volumes combined. The U.S. gets about half of its aluminium from foreign sources.

Prime Minister Mark Carney's office said Canada was "engaged in intensive and live negotiations to have these and other tariffs removed."

Mexico's Economy Minister Marcelo Ebrard reiterated that the tariffs were unsustainable and unfair, especially given that Mexico imports more steel from the U.S. than it ships there.

Separately, alarm over China's hold on the critical minerals market is growing as global automakers joined U.S. counterparts to complain that its restrictions on exports of rare earth alloys, mixtures and magnets could cause production delays.