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Tensions in the steel trade between the United States and Mexico are starting to ease. According to sources familiar with the matter, the two countries are moving closer to an agreement that could reduce or eliminate the 50% tariffs on Mexican steel imports imposed under the Trump administration.

📦 Quotas on the Table? Steel Exports Might Be Freed – But Only in Part
One of the proposals being discussed involves a quota system, allowing Mexico to export a specific amount of steel to the U.S. duty-free or at a reduced rate. Once this limit is exceeded, the full 50% tariff would apply.
The exact level of this quota has not yet been finalized, and it’s also unclear whether the steel under quota would be entirely duty-free or just taxed at a lower rate. Details remain under negotiation.

🗣️ Ebrard: Trump’s Tariffs Are Unfair and Unsustainable
Mexican Economy Minister Marcelo Ebrard didn’t mince words, calling Trump’s tariffs unjust and economically damaging during a speech in Mexico City. He said Mexico will present strong arguments to the U.S. on why the tariffs should be rolled back or relaxed.
Ebrard traveled to Washington on June 6 to meet with U.S. officials and revealed that Mexico has a "Plan B" ready in case the talks fail — although he did not provide specifics.

🚛 Limited Duty-Free Imports Based on Historical Levels
According to ongoing discussions, U.S. companies would be able to import Mexican steel duty-free up to a certain limit, which would be based on historic trade volumes between the two countries. Any imports above this threshold would be taxed at the full rate.
In 2024, Mexico exported 3.52 million net tons of steel to the U.S. — a 16% drop compared to 2023 (4.18 million tons). This still made Mexico the third-largest steel supplier to the U.S., behind Canada (6.56 million tons) and Brazil (4.5 million tons).

❌ White House Silent, but Pressure Builds
While neither the White House nor the Department of Commerce, which oversees tariffs under “Section 232,” have commented publicly, industry leaders are pressuring officials to implement a clear quota system for Mexico. They say it would help avoid the kind of unexpected import surges seen in the past.

🌐 U.S. Aims to Block Third-Party Steel via Mexico
A major concern for U.S. officials is that steel from countries like China could be routed through Mexico to avoid U.S. tariffs. That’s why they’re pushing for safeguards that would prevent such transshipment or relabeling of foreign steel.

⚖️ Exemptions Never Came: What Happened in 2018?
When Trump introduced a 25% steel tariff in 2018, Mexico and Canada were granted special treatment — but no formal quota system was put in place. Brazil, by contrast, did receive quotas. This gap remains a sticking point in today’s negotiations.
In April 2024, Trump further escalated the policy by revoking all previous exceptions and exclusions, raising tariff rates even more across steel and aluminum products.

🔍 Ebrard: The U.S. Has a Trade Surplus – Why Punish Mexico?
Ebrard also pointed out that the U.S. runs a trade surplus with Mexico in steel and aluminum, questioning the logic of punitive tariffs. He argued that Mexico is not harming U.S. industry and remains a trusted trade partner.

🔚 What Comes Next?
While a final deal hasn’t been signed, optimism is growing. If the two nations agree on a fair quota, it could be a win-win scenario — the U.S. retains control over imports, and Mexico gains predictability for its exports.

#SteelTariffs , #TRUMP , #mexico , #usa , #TradingCommunity

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