March 14, 2025 – The trade landscape has shifted dramatically with the confirmation of new U.S. tariffs and ensuing responses from key trading partners. The United States government has confirmed 25% tariffs on steel and aluminum imports, a move that is impacting a wide range of industrial materials and components. This update provides an overview of the confirmed tariff increases, how they affect fasteners, hardware, and related materials, and the retaliatory measures from Canada, Mexico, and China. We also discuss potential future tariff risks and how they compare to past increases. Our goal is to help Atlas Manufacturing customers understand these developments in a formal but approachable way, so you can navigate the challenges ahead.

Confirmed 25% Tariffs on Steel and Aluminum (and Impact on Materials)

Effective this month, the U.S. government has imposed a 25% tariff on all imports of steel and aluminum. This is a blanket rate applied to virtually all sources, including countries that were previously exempt from earlier tariffs. The tariff hike is aimed at protecting U.S. metal industries from unfair trade practices and global excess capacity, but it also means significant cost increases for manufacturers relying on imported metal products.

Notably, the **25% rate applies not only to raw steel and aluminum but also to certain derivative products made from these metals. In practice, this means that many fasteners, hardware, and related materials fall under the tariff. Common items such as screws, bolts, nuts, washers, nails, and other assembly hardware are often classified as derivative steel products – and they now incur the same 25% import duty. Similarly, any components made from aluminum (unless the aluminum was smelted and cast in the U.S.) are subject to the tariff.

For Atlas Manufacturing and our customers, this development translates to higher costs for metal parts and supplies. Prices for imported fasteners and hardware have begun rising accordingly, and supply chain managers are bracing for longer lead times as suppliers adjust. While the policy’s intention is to boost domestic metal production, in the short term manufacturers are facing increased expenses on essential inputs. We recommend reviewing your bills of materials to identify parts that may be affected and discussing with suppliers about pricing or sourcing adjustments.

Canada’s Retaliatory Tariffs on U.S. Goods

America’s northern neighbor has responded swiftly with its own measures. The Canadian government announced that its initial set of retaliatory tariffs – valued at about CA$30 billion (US$21 billion) – will remain in place despite the U.S. actions. This first wave of Canadian tariffs imposes a 25% surtax on a broad list of U.S. exports, including everyday products like orange juice, peanut butter, coffee, appliances, footwear, cosmetics, motorcycles, and certain paper products. These counter-tariffs were designed to hit a range of American industries and signal that Canada is prepared to match U.S. trade measures dollar-for-dollar.

Canada had also prepared a second wave of retaliatory tariffs — an even larger package worth roughly CA$125 billion (US$87 billion) — targeting additional U.S. goods such as electric vehicles, fruits and vegetables, dairy and meat products, electronics, steel, and trucks . However, this second wave has been suspended for now after last-minute negotiations led the U.S. to temporarily pause some of its tariffs. Canadian officials indicated that while they welcome the pause, they are not lifting the initial tariffs and stand ready to deploy the next round if the trade dispute escalates.

In a unique regional twist, provincial authorities in Canada have taken action as well. For example, Ontario’s government imposed a 25% increase in the price of electricity exports to the U.S. as a direct response to the U.S. tariff plan. Ontario supplies power to parts of the northern United States, and this move means some American consumers and businesses will pay 25% more for electricity imported from Ontario. This retaliatory step underscores the breadth of Canada’s response – reaching beyond traditional goods into energy – and adds further costs for U.S. regions that rely on Canadian electricity.

For U.S. manufacturers, Canada’s tariffs could raise the cost of exporting certain goods into the Canadian market or make sourcing from Canada more expensive. Atlas Manufacturing customers who export to Canada or purchase Canadian materials should review these tariff lists closely. The Canada-U.S. trade relationship is under strain, and companies may need to adjust pricing or supply arrangements for affected goods in the coming weeks.

Trade Tensions with Mexico

Mexico has likewise criticized the U.S. tariff move and is taking steps to defend its economic interests. Shortly after the U.S. announcement of 25% tariffs on Mexican goods, Mexico’s government vowed retaliatory tariffs on U.S. exports. President Claudia Sheinbaum instructed economic officials to implement a “Plan B” of countermeasures, emphasizing that Mexico prefers dialogue but “had been forced to respond in kind.” Although exact targets were not immediately disclosed, sources indicate that Mexico has been preparing tariffs ranging from 5% to 20% on key U.S. products. Likely targets include pork products, cheeses, fresh produce (fruits and vegetables), manufactured steel and aluminum items, and other goods that were notably hit in a similar 2018 dispute . In a gesture aimed at maintaining some stability, Mexico has initially excluded the automotive sector from its tariff plans, seeking to spare the highly integrated auto industry from immediate harm.

Mexican officials have also publicly condemned the U.S. tariffs as a breach of the United States–Mexico–Canada Agreement (USMCA), the free trade pact binding the three nations. Mexico’s Economy Minister termed the U.S. action a “flagrant violation” of the agreement’s spirit, underscoring the legal and diplomatic tensions now at play. By invoking the USMCA, Mexico signals that it may pursue remedies under the trade deal’s dispute mechanisms even as it retaliates commercially. In the meantime, Mexico’s government is actively consulting with industries on which U.S. goods to target to maximize pressure while trying to minimize harm to its own consumers. We expect Mexican retaliatory tariffs to focus on U.S. agricultural exports (such as grains, meats, and dairy) – areas where Mexico can source alternatives elsewhere – as well as certain metal products. This strategy mirrors Mexico’s response in 2018, when it levied tariffs on U.S. pork, cheese, apples, potatoes, and bourbon, among other items.

For companies operating in or trading with Mexico, these developments raise uncertainty. Cross-border supply chains (especially in agriculture and manufacturing) could face higher costs and logistical hurdles once Mexico’s tariff list takes effect. Atlas Manufacturing advises monitoring announcements from the Mexican government in the coming days (Mexico indicated it would finalize its retaliation plans by mid-March). If you import components from Mexico or export U.S.-made goods to Mexican partners, be prepared for potential duty increases and consider accelerating shipments or finding temporary alternatives if possible. The trade environment with Mexico is becoming as strained as that with Canada, making North American market conditions increasingly complex.

China’s Countermeasures in the Ongoing Trade Dispute

Beyond North America, the U.S. has also tightened trade measures against China, and China has retaliated in kind. In early March, the U.S. increased the tariff rate on imports from China (and Hong Kong) from 10% to 20%. This doubling of tariffs broadened the ongoing Section 301 trade war, which has been active since 2018, and was justified by Washington on grounds ranging from trade imbalance to national security concerns. In response, Beijing announced new tariffs on U.S. goods effective the same week. China instituted a 15% tariff on certain American agricultural commodities – including chicken, wheat, corn, and cotton – and a 10% tariff on other products like sorghum, soybeans, pork, beef, seafood, fruits, vegetables, and dairy. These tariffs are designed to hit major U.S. export sectors, particularly agriculture, which is a sensitive area for the U.S. economy and a crucial supplier of foodstuffs to China.

Additionally, China is maintaining its existing tariffs (generally in the 10–15% range) on other U.S. goods, such as liquefied natural gas (LNG), coal, crude oil, farming equipment, and certain automotive parts. By keeping these in place, China continues to leverage a wide array of countermeasures first implemented during earlier rounds of the trade war. The combined effect is a significant barrier to U.S.–China trade in both directions: American importers face 20% costs on Chinese materials and products, while American exporters to China encounter a patchwork of tariffs typically between 10% and 15% (and now up to 15% on key crops and meats).

The escalation with China means that, simultaneously with the North American tariffs, U.S. manufacturers must navigate elevated tariffs on Chinese inputs and components. Many Atlas Manufacturing customers source components, fasteners, or raw materials from China, so this 20% tariff will directly raise those import costs. Conversely, any customer who sells machinery or goods into China might see orders slow down due to China’s retaliatory duties making those products more expensive in the Chinese market. This synchronized trade tension across multiple fronts is creating a complex global challenge. We encourage businesses to diversify supply chains where possible and work with customs experts to ensure compliance with the shifting tariff rates. The U.S.–China tariff exchange is part of a broader strategic standoff, and it shows no sign of immediate resolution, meaning these import taxes could persist for some time.

How These Tariffs Compare to Past Increases

With tariffs rising and counter-tariffs flying, it’s useful to put the 2025 tariff spike in historical context. The scale of the current increases is significant but not entirely unprecedented. In 2018, under Section 232 national security authorities, the U.S. imposed similar tariffs – 25% on imported steel and 10% on imported aluminum – which at the time was a major escalation in trade protections. The new 2025 tariffs effectively reinstate and exceed those past measures: steel is again at 25%, and aluminum is now raised to 25% as well, matching the steel tariff and surpassing the previous 10% aluminum rate. In other words, the tariff level on steel is on par with the peak from 2018, while the tariff on aluminum is higher than anything seen in recent memory for that category.

There are also differences in scope and exceptions when comparing 2025 to past tariff episodes. The 2018 steel and aluminum tariffs initially exempted certain allies (for example, Canada and Mexico were temporarily excluded, and some countries negotiated quotas or special terms). In contrast, the 2025 tariffs cast a wider net – they apply to virtually all countries, including allies and USMCA partners, with very limited exclusions . Even goods that meet USMCA rules of origin were only briefly exempted and are now largely covered by the tariffs after the short negotiation pause. This near-universal application makes the current tariffs more expansive in reach than the targeted tariffs of the past.

On the retaliation side, the responses we’re seeing now from Canada, Mexico, and China are broader and more synchronized than in past trade disputes. In the 2018 tariff round, U.S. trading partners did retaliate, but those lists were somewhat narrower (each country targeted a range of politically sensitive goods, yet many sectors were left untouched). Now in 2025, Canada’s retaliation covers a wide span of consumer and industrial goods , and it had plans to escalate dramatically. Mexico is preparing broad measures on both farm and metal products , and China has layered new tariffs on top of existing ones. The breadth of products affected on all sides – from food and beverages to automotive and machinery – suggests that the impact on global supply chains could be more extensive this time. Businesses across multiple industries (construction, automotive, agriculture, consumer goods, etc.) are now concurrently dealing with tariff-driven cost increases, whereas in past episodes some could avoid direct impacts if they weren’t in the specific targeted categories.

In summary, while tariffs at the 25% level have occurred before, the 2025 tariff surge is marked by its comprehensive scope and the rapid, large-scale pushback from multiple countries. It represents a more intense phase of trade friction compared to most previous increases. Understanding this context can help businesses appreciate why the current environment feels especially challenging – it’s not just a repeat of 2018, but in many ways an escalation built on that foundation.

Potential Future Tariff Risks and Considerations

While we now have clarity on the current tariffs, there remain significant uncertainties about the future. Businesses should be aware of several risk areas going forward:

• Possibility of Additional Tariffs: The trade conflict could widen to other products. The U.S. government has already launched new investigations (under Section 232 and other trade laws) into imports of other metals and materials like copper, uranium, and lumber. This raises the prospect of additional tariffs beyond steel and aluminum. There have also been hints of potential tariff increases on energy products – for instance, a threat to raise tariffs on imported oil and gas if negotiations with suppliers falter. If the disputes deepen, we cannot rule out the tariff percentage climbing further (some officials have floated rates above 25% for certain countries or products). The situation is fluid, and each round of talks (or breakdown in talks) could trigger new tariff announcements with little warning.
• Regulatory and Policy Shifts: The legal basis for these tariffs is an emergency economic declaration, and the tariffs will remain in effect indefinitely until the President declares the emergency over. This means the timeline is uncertain – tariffs could last for months or years, or be lifted if an agreement is reached. Additionally, domestic politics and international diplomacy will play a role. A change in U.S. administration or policy direction could alter the tariff strategy overnight, either by doubling down or by rolling back measures in exchange for concessions. Likewise, Canada, Mexico, and China might adjust their retaliatory tariffs depending on how negotiations proceed or if disputes are resolved through organizations like the WTO. In short, the rules of the game may shift quickly. Companies need to stay vigilant for proclamations, executive orders, or trade deal updates that could suddenly change tariff rates or introduce new compliance requirements. We recommend designating a team member or resource to monitor trade news and regulatory bulletins so you can respond promptly to any changes.
• Industry Reactions and Market Responses: The manufacturing and supply chain community is not standing still in the face of these tariffs. We are already seeing industry reactions that could pose both risks and opportunities. Some manufacturers are stockpiling inventory of affected materials in the short term, which can lead to temporary shortages or price spikes in the market. Others are seeking alternative suppliers in non-tariffed countries, though as one logistics report noted, for blanket tariffs on ubiquitous materials like steel and aluminum, switching sourcing countries may not avoid costs since the tariff applies globally. There is also increased interest in localizing production – moving manufacturing onshore or to tariff-exempt zones – to mitigate long-term tariff exposure. This can be a costly endeavor and is not feasible for all, but it’s a trend to watch; if major competitors relocate production, it could shift market dynamics. On the flip side, some companies are lobbying for exemptions or reimbursements, and industry groups are pressing policymakers for relief. If these efforts gain traction, we might see special exclusions granted for certain critical products or industries, which could suddenly remove tariffs on specific items. The key takeaway is that the market will continue to adapt: expect fluctuations in supply and pricing as businesses respond to the new normal. Flexibility and contingency planning are crucial for any company importing or exporting significant volumes under these tariff conditions.

Next Steps

The confirmation of 25% tariffs on steel and aluminum imports – and the ensuing countermeasures by Canada, Mexico, and China – is reshaping the business environment in 2025. For companies like Atlas Manufacturing and our customers, these developments bring both challenges and important decisions. Raw materials and components costs are rising, especially for anything containing steel or aluminum (from structural beams down to nuts and bolts). Meanwhile, export markets are encountering new barriers, as our products face foreign tariffs that can squeeze demand abroad.

However, by understanding the situation and proactively managing our response, we can mitigate some of the impact. This revised overview has outlined the key facts: the U.S. tariffs in place and their scope, the retaliatory actions by major trade partners, how this scenario compares to past tariff events, and potential risks on the horizon. The intent is to equip you, our valued customers and partners, with a clear picture of the current trade climate. While the circumstances are complex, knowledge is a critical first step to adaptation.

At Atlas Manufacturing, we remain committed to guiding and supporting our customers through these turbulent times. Our team is continuously monitoring tariff developments and analyzing how they affect supply chains, production costs, and project timelines. We are already exploring strategic responses – from sourcing adjustments to pricing strategies – to help cushion the impact on your operations.

If you have questions about how these tariff changes might affect your specific business needs, or if you need guidance in navigating the new regulations, please reach out to us. Our experts are here to provide personalized advice and solutions, whether it’s understanding compliance requirements or identifying alternative supply options. In an environment of uncertainty, Atlas Manufacturing is your partner for finding clarity and charting a path forward. Together, we can adapt to these tariff challenges and continue moving ahead with confidence.

Bibliography

1. U.S. Department of Commerce – Section 232 Tariffs

Official government overview of Section 232 tariffs on steel and aluminum, including national security justifications.

2. United States Trade Representative (USTR) – Section 301 Tariffs

Information about Section 301 tariffs targeting Chinese imports due to unfair trade practices.

3. Federal Register Notice (2025-02833)

Detailed documentation outlining new tariff orders implemented in March 2025.

4. United States International Trade Commission – HTS Codes Chapter 73

Comprehensive list of Harmonized Tariff Schedule codes covering steel and iron articles subject to new tariffs.

5. Federal Register Notice on Expanded Tariff Scope

Government announcement expanding Section 232 tariffs to derivative and downstream steel and aluminum products.

6. Reuters News – Canada-U.S. Tariff Dispute (March 2025)

Coverage of Canada’s retaliatory tariffs and U.S. tariff threats against Canadian steel and aluminum imports.

7. Bloomberg – Recent Developments in Mexico-U.S. Trade Relations

Information regarding Mexico’s planned retaliatory tariffs against U.S. exports in response to U.S. steel tariffs.

8. Wall Street Journal – China-U.S. Tariff Escalation (March 2025)

Detailed analysis of China’s counter-tariffs against U.S. exports following new U.S. Section 301 tariff increases.