US imposes 30% tariffs on EU, Mexico imports from Aug. 1; steel, automotive products in focus

The US will impose 30% tariffs on all imports from the EU and Mexico from Aug. 1, a development that is expected to impact trade in key commodities including steel and energy, as well as automotive products.

The 30% tariffs were announced by US President Donald Trump in letters sent to the presidents of Mexico and the EU, which he posted on Truth Social July 12.

The EU and Mexico are the leading trade partners of the US.

The US is the EU's second-largest export market for steel, while Mexico leads exports of automotive products to the US.

In the letter to Mexican President Claudia Sheinbaum, Trump said Mexico "still has not stopped the cartels," and as a result, the US will start levying the tariffs. However, he added there will be no tariffs on Mexico if it builds or manufactures products in the US.

Similarly, Trump in his letter to EU President Ursula von der Leyen said the US had decided to end its trade deficit with the bloc and would go ahead with the tariffs, unless the EU decides to build or manufacture products in the US.

It was not clear if the current tariffs on Mexico would conflict with exemptions on trade of goods signed under the USMCA trade agreement.

Both letters mentioned that these tariffs are separate from the "sectoral tariffs" and any "good transhipped to evade this higher tariff will be subjected to that higher tariff."

In the week starting July 7, Trump sent letters to several countries imposing a varied range of tariffs on its key trade partners, including Canada, another key supplier of commodities such as steel, natural gas, and beef.

Metals sector uncertainty

From a metals perspective, the change in tariffs brings uncertainty to steel, aluminum and copper markets, as the US already has a separate 50% tariff on each of these commodities, considered critical for the economy and energy transition.

The 50% tariffs on steel imports and reciprocal tariff threats have led the US construction industry to postpone projects due to uncertainty about prices.

Since the start of 2025, Platts-assessed TSI US HRC EXW Indiana reached a year-to-date high of $950/st on March 12, the day when Trump announced the first round of tariffs. However, prices since those highs have fallen 8.4%, reaching $870/st July 11. Platts is part of S&P Global Commodity Insights.

The EU exported about 17% of its exportable finished steel products to the US in 2024, according to Comex data.

EU steel product exports remained steady in 2024 year over year, according to S&P Global Commodities at Sea data.

From an agricultural perspective, markets in Mexico will be watching for the next developments as the country is a key importer of US corn, pork, chicken and beef.

Mexico also supplies crude oil to the US, while the US is a major supplier of refined products to Mexico.

The US runs its highest trade deficit with Mexico, according to the US Census Bureau.