Posted on 11 Jun 2025
The United States and Mexico are negotiating a deal to reduce or eliminate President Donald Trump's 50% steel tariffs on imports up to a certain volume, industry and trade sources said on Tuesday.
An industry source familiar with the talks said that a likely outcome would include a quota arrangement, under which a specified volume from Mexico could enter duty free or at a reduced rate and any imports above that level would be charged the full 50% tariff.
It was unclear whether the deal would eliminate tariffs altogether for in-quota steel import volumes from Mexico or reduce them to a lower level, the source said. The specific volume level of the quota also was not yet determined.
Bloomberg News first reported the negotiations over tariff reductions for Mexican steel, quoting people familiar with the matter as saying that the two sides were close to a deal. The report said that terms of the agreement had not been finalized but would allow U.S. companies to import Mexican steel tariff-free as long as total shipments are kept below a level based on historical trade volumes.
A White House spokesperson declined comment, while a spokesperson for the Commerce Department which administers Trump's "Section 232" national security tariffs on steel and aluminum did not respond to a request for comment.
Mexico was the third largest source of U.S. steel imports in 2024 at 3.52 million net tons, down 16% from 4.18 million in 2024, according to U.S. Census Bureau data compiled by the American Iron and Steel Institute.
Canada was the largest foreign steel supplier at 6.56 million net tons in 2024, followed by Brazil at 4.5 million.
When Trump first imposed 25% steel tariffs in 2018, Mexico and Canada were granted exemptions with special procedures aimed at curbing any import surges beyond historical volumes. But these measures stopped short of a formal quota arrangement such as that for Brazil.
Trump canceled all steel and aluminum quotas, exemptions and exclusions in April to strengthen the metals tariffs, raising the effective rate.
A second trade source told Reuters that industry officials were pressing for a clearly defined steel quota arrangement for Mexico, given past import surges from Mexico. U.S. officials have long sought to curb the transshipment of steel products from third countries such as China via Mexico to the United States.
Mexican Economy Minister Marcelo Ebrard told reporters at a morning event that the government had argued to U.S. officials that the tariffs were unjustified, noting the United States runs a trade surplus with Mexico in steel and aluminum.
"Putting a tariff on a product where you have a surplus is quite debatable because the objective of the tariff is to reduce the deficit," he added.
Source:Reuters
