The U.S. government has confirmed that recycled ferrous and aluminum scrap will remain exempt from the newly reinstated Section 232 tariffs. The Recycled Materials Association (ReMA) clarified that, despite the 2025 tariff increases on steel and aluminum imports, scrap metal will not face additional duties. This exemption, introduced in 2017, ensures that scrap metals can continue to flow freely across U.S. borders, benefiting the recycling industry.
Tariff Increase and Trade Measures
On February 14, 2025, President Trump reinstated tariffs on steel and aluminum imports, raising aluminum tariffs from 10% to 25%. The increase, effective March 12, will impact all countries, including major trading partners like Canada and Mexico. Alongside this, the U.S. government plans to introduce reciprocal tariffs, targeting countries that fail to match U.S. tariffs, potentially affecting global recycled material trade.
The Aluminum Extruders Council (AEC), which represents U.S. aluminum manufacturers, fully supports the tariff increases. The AEC believes the move will close tariff loopholes, limit unfair imports, and strengthen U.S. manufacturing capacity. The tariffs aim to reduce global aluminum overproduction and boost domestic jobs in the aluminum sector.
Impact on Steel Industry and Domestic Production
Although the tariff increase focuses on aluminum, steel production remains sluggish. The American Iron and Steel Institute (AISI) reported a 0.3% decrease in steel production for the week ending February 15, 2025. U.S. steel mills operated at 75% capacity, down from 77.7% in February 2024. While tariffs offer protection against foreign overcapacity, the steel industry has not yet seen a significant production boost.
Looking Ahead: How Scrap Metal Traders Benefit
Recycled materials continue to play a critical role in the U.S. economy, particularly as tariffs provide some protection to domestic industries. ReMA’s analysis stresses that the scrap metal sector remains unaffected by the Section 232 tariffs. This continues to allow scrap exporters to engage in free trade while supporting sustainable, domestic production processes.
The government’s trade strategy aims to curb foreign market distortions and address global steel and aluminum overproduction. With rising demand for metals in green technologies, the continued free flow of recycled scrap will be vital in meeting both domestic and global needs.
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