US and Japan set to end Trump-era steel tariffs

Washington to suspend 25% levy on incoming steel imports from Japan up to certain threshold

The truce reportedly does not cover aluminium imports, which remain subject to a 10 per cent tariff. AP

The US and Japan are set to announce an agreement on Monday that will end tariffs imposed on Japanese steel under former president Donald Trump, people familiar with the situation said.

Washington will suspend the 25 per cent levy on incoming steel imports from Japan up to a certain threshold, with anything beyond that still subject to additional charges, said the people who declined to be identified as the details are private.

The solution mirrors the accord that the US reached with the EU in October that ended punitive measures on as much as $10 billion of each other’s goods.

The truce doesn’t cover aluminium imports, which remain subject to a 10 per cent tariff, the people said.

A spokesman for the Office of the US Trade Representative declined to comment. The Commerce Department and the Japanese embassy in Washington didn’t immediately respond to requests for comment.

The metals dispute started in 2018, when Mr Trump imposed duties on steel and aluminium from the EU, Asia and elsewhere, citing risks to national security.

The EU subsequently retaliated, hitting products including Harley-Davidson motorcycles, Levi Strauss & Co jeans and bourbon whiskey.

The US made an offer to Japan to resolve the dispute in December, but Tokyo was holding out for a better deal and had wanted the tariffs to be abolished completely, an official with knowledge of the talks said at the time.

Washington’s proposal to Japan was similar to the deal with the EU, in that a certain amount of steel and aluminium — based on the historical averages shipped — will be allowed to enter the US free of duties, the people said.

The US imported about 1.7 million metric tonnes of steel from Japan in 2017, the most recent year not affected by the tariffs, and 1.9 million tonnes in 2016, Census Bureau data show. In 2020, inbound steel shipments to the US from Japan totalled 732,158 tonnes, Census said in a separate report.

Last month, the US and UK started talks to address tariffs on both steel and aluminium and the problem of global overcapacity, aiming to remove a long-standing irritant between the two nations and focus attention on China.