Mexico got a concession on tariffs from United States President Donald Trump last week, but it couldn’t avoid duties on the steel and aluminum it exports to its northern neighbor.
The United States on Wednesday imposed 25% tariffs on all steel and aluminum imports, as per an executive order Trump signed on Feb. 10. The tariffs — imposed on national security grounds — also apply to hundreds of products made with those metals, including nuts and bolts, bulldozer blades and soda cans, according to Reuters.
Mexico and other countries tried to get an exemption to the duties but were unsuccessful.
“President Trump has once again used the leverage of the American economy, which is the best and biggest in the world, to deliver a win for the American people,” White House spokesperson Kush Desai said in a statement on Tuesday.
“Pursuant to his previous executive orders, a 25% tariff on steel and aluminum with no exceptions or exemptions will go into effect for Canada and all of our other trading partners at midnight, March 12th,” he said.
The tariffs took effect six days after Trump announced that imports from Mexico covered by the USMCA free trade pact would not be subject to U.S. tariffs until at least early April.
That announcement came two days after the United States imposed 25% tariffs on all imports from Mexico.
On Wednesday morning, President Claudia Sheinbaum said that her government would wait until April 2 to decide whether it would retaliate against the U.S. tariffs on Mexican steel and aluminum. April 2 is the date the United States intends to impose reciprocal tariffs on imports from all its trade partners.
Sheinbaum once again expressed confidence that the vast majority of Mexican goods won’t be subject to reciprocal tariffs as Mexico, in accordance with the USMCA, doesn’t impose tariffs on most products it imports from the United States.
Speaking at her morning press conference, she noted that Mexico’s Economy Minister Marcelo Ebrard met with U.S. Commerce Secretary Howard Lutnick in Washington on Tuesday and said that the two countries had agreed to keep talking ahead of the April 2 commencement of the United States’ planned reciprocal tariffs.
“We’re going to wait until April 2 and then we will decide whether or not to impose reciprocal tariffs,” Sheinbaum said.
While Mexico is adopting a wait-and-see approach, Trump’s new tariffs drew “swift retaliation” from Canada and Europe, Reuters reported.
After the first Trump administration imposed tariffs on Mexican steel and aluminum in 2018, Mexico retaliated with duties on U.S. pork, apples, steel, potatoes, bourbon, cheese and various other products. Many of the products Mexico targeted in 2018 are produced in large quantities in states Trump won in last year’s presidential election, such as Iowa (pork) and Kentucky (bourbon).
In May 2019, almost a year after the tariffs took effect, the United States government agreed to lift its duties on Mexican and Canadian steel and aluminum, removing a major obstacle for the ratification of the USMCA.
The Mexican government’s argument against the current tariffs centered on the fact that Mexico buys more steel and aluminum from the United States than it sells.
Ebrard said last month that the 25% tariffs are illogical and a “bad idea” with regard to Mexico.
How will the tariffs impact Mexico?
Mexico is the world’s second largest exporter of steel, aluminum and products derived from those metals to the United States, according to 2024 data from the U.S. Department of Commerce. The value of those Mexican exports to the U.S. was US $34.83 billion last year, second only to China.
Most of that amount, however, came from the export of products derived from aluminum and steel. Mexico’s exports of steel itself to the United States were worth US $3.5 billion last year, while aluminum shipments generated revenue of $397 million.
After Trump signed his Feb. 10 executive order, the Mexican Iron and Steel Industry Chamber (Canacero) expressed its “profound disagreement” with 25% tariffs on Mexican steel.
“This measure will severely affect the iron and steel industry and North America’s entire metalworking chain, placing competitiveness and regional integration at risk,” Canacero said in a Feb. 11 statement.
The industry group said that the tariffs posed a threat to 75% of Mexico’s steel exports and placed at risk “jobs and key investment in our country.”
“If exclusion of Mexican steel from this measure is not achieved, it will be necessary to apply reciprocal reprisals on United States steel products,” Canacero said.
According to the Mexican Institute for Competitiveness (IMCO), a Mexico City-based think tank, the United States’ steel and aluminum tariffs will impact 4.7% of all Mexican exports. Mexico’s exports of steel, aluminum and derivative products collectively contributed to 1.56% of Mexico’s GDP in 2024, the think tank said.
A partir de mañana, 12 de marzo, entrarán en vigor los aranceles del 25% al acero y al aluminio. En el caso del aluminio, 🇺🇸 impondrá aranceles a ciertos productos inesperados dentro de la lista, lo que afectará las exportaciones mexicanas. 🔎Consulta más: https://t.co/NVKY13GAHA pic.twitter.com/4NWgR3C4JH
— IMCO (@imcomx) March 11, 2025
While Mexico only exports about US $3.5 billion of steel and US $397 million of aluminum to the U.S., the Mexican Institute for Competitiveness says the tariffs would apply to a wide variety of products made in Mexico with these metals. (IMCO)
In a statement issued in late February, IMCO noted that auto parts, domestic appliances and electronic products manufactured in Mexico will be affected by the tariffs. The manufacture of those products is “crucial” to the industrial sectors of at least 11 Mexican states, the think tank said.
IMCO calculated that the new 25% tariffs — if they had been in effect in 2024 — would have affected Mexican goods worth US $22.53 billion.
The figure is lower than the total value of Mexico’s steel and aluminum exports to the United States last year because the new tariffs only apply to the steel and aluminum content of a product partially derived from those metals, not the entire product. In addition, United States steel and aluminum used in products exported to the U.S. are not subject to the 25% tariffs.
Among the Mexican products that are subject to the new tariffs, IMCO listed those that generated the most revenue as a result of their shipment to the United States last year.
- Auto body parts: $7.71 billion
- Air conditioner parts: $2.88 billion
- Vehicle engine parts: $1.45 billion
- Vehicle air conditioner parts: $1.14 billion
- Vehicle suspension parts: $817.6 million
- Telephone parts: $814.5 million
- Metal furniture: $727.5 million
- Machines and mechanical devices: $572.7 million
- Fridge and freezer parts: $428.9 million
- Electrical devices: $407 million
IMCO noted that Mexico’s auto industry, “one of the country’s main export sectors,” will be “directly” impacted by the tariffs.
The El Economista newspaper reported that the United States’ universal steel and aluminum tariffs will drive up prices for a range of products in the U.S., including cars, domestic appliances, construction materials and solar panels.
The New York Times reported that “because steel and aluminum are used to make so many other products, raising the price of the metal will have ripple effects throughout the U.S. economy.”
“By increasing costs of basic inputs for many companies, the tariffs could harm manufacturers who ultimately employ far more Americans than steel mills and aluminum smelters do, potentially causing Mr. Trump’s plans to bolster U.S. manufacturing to backfire,” the Times said.
With reports from El Economista, Reforma, El Financiero, Reuters and El Universal
