On May 17, 2019, after numerous rounds of negotiations, the United States, Canada, and Mexico issued formal statements on lifting duties on Section 232 steel and aluminum products. While Canada and the U.S. explicitly stated that their respective tariffs would be lifted within the next two days, Mexico has yet to announce how quickly their retaliatory tariffs would end.
In the new agreement between the US and Canada, the U.S. would be lifting the imposed tariffs from last June– 25% on imports of steel and 10% on aluminum – as well as Canada’s retaliatory tariffs on steel and aluminum products. Similarly, Mexico will be lifting their retaliatory tariffs that targeted U.S. pork, dairy, and metal products.
The Office of the United States Trade Representative published a statement outlining the new provisions of the agreement:
“The agreements provides for aggressive monitoring and a mechanism to prevent surges in imports of steel and aluminum. If surges in imports of specific steel and aluminum products occur, the United States may re-impose Section 232 tariffs on those products. Any retaliation by Canada and Mexico would then be limited to steel and aluminum products.”
Within the new agreement, there was no explicit language on the potential for quotas. Additionally, the agreement indicates that if the U.S. re-imposes tariffs, Canada and Mexico would only be allowed to place retaliatory tariffs on steel and aluminum products. This is an important distinction that protects American farmers from being hit with retaliatory tariffs.
We will continue to monitor this situation. For more information, please contact the International Trade and Supply Chain team.