March 13, 2025 • 15 mins
After weeks of uncertainty that ricocheted through markets, President Trump’s 25% tariffs on steel and aluminum imports from every country in the world went into effect on Wednesday morning.
Immediately after, Canada and the EU retaliated. Now, investors, automakers and American consumers are wondering how it will hit the economy.
On today’s Big Take DC podcast, host Saleha Mohsin is joined by Bloomberg’s Josh Wingrove to explore what Trump’s metals tariffs could mean for domestic manufacturing and for America’s relationships with some of its closest allies.
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Episode Transcript
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Speaker 1 (00:02):
Bloomberg Audio Studios, podcasts, radio news. President Trump's twenty five
percent tariffs on steel and aluminum imports from every country
in the world went into effect on Wednesday morning, with
no exceptions. The United States of America is going to
take back a lot of what was stolen from it
by other countries and by frankly incompetent US leadership. The
(00:26):
tariffs mark a key piece of Trump's agenda to reshape
US trade from Washington, and a return to a similar
policy from his first term. But just hours after the
tariffs went into effect, Canada retaliated with twenty five percent
tariffs on about twenty one billion dollars of US made products.
The EU hit back two with countermeasures against over twenty
(00:49):
eight billion dollars worth of American goods. Now, investors, automakers,
and American consumers are wondering will these tariffs hold up
and what could their impact to be long term? From
Bloomberg's Washington Bureau, This is the Big Take DC podcast,
I'm Saleamosen. Today. On the show, I'm joined by Bloomberg's
(01:12):
Josh Wingrove to explore what Trump's latest tariffs on steel
and aluminum mean for the US economy and America's relationships
with some of its closest allies. Put this into context
for me, how much does the US rely on the
imports of these metals.
Speaker 2 (01:34):
This is going to be a lot bigger for aluminum
than steel. You know, Steel is a case where there
is existing or a lot more existing capacity that the
industry really wants to lean on. And so the steel
companies and industry groups have generally been for these tariffs
and SLA that's a lot different than a lot of
other industries. Right In autos, for instance, they have been
warning against the tariffs and in fact got the exemption
(01:57):
last week from President Trump on those canes in Mexico tariffs.
It's not only is Canada my homeland, I should say,
the number one source of US aluminum imports. I mean,
it's just huge amounts so to tear if these things.
Trump is obviously, on the one hand, trying to create
an incentive to develop new smelters, which by the way,
(02:18):
are not done quickly and which by the way, use
a lot of electricity. So it's a bit of a
tricky landing to stick. But in the meantime, it's just
simply going to be an extra cost for American companies
that use aluminum, which of course is a wide range
of industries. So these are pretty big ones, and I
should note they're bigger than the first term. I think
people are missing this a little bit right. Trump did
a lot of stuff in his first term, and stealing
(02:40):
aluminum were a big part of it, but there were
exemptions for countries and there were also different rates. What
he's doing here also is raising the rate in illuminum
to twenty five from ten last time it was ten,
so the scope is broader in terms of application. There's
no exclusions. Trump even mused about an Australia exclusion, didn't
give it. And the rate is higher for aluminum. It's
the same steal.
Speaker 1 (03:00):
Where does most of the US's metal supply come from?
What countries?
Speaker 2 (03:05):
That depends what you're talking about. Aluminum is certainly Canada.
Steal is more of a mix, and there's been appetite
to hit some of those countries. And the big concern
on this, of course is China. And the concern is
is Chinese deal kind of sneaking in through Mexico and
Canada or other places. And that's the justification you'll hear
from the White House for these tariffs. Now, those third
(03:26):
party countries, of course their position is, well, if that's
a genuine concern, let's talk about that rather than paint
with a wide brush. Russian metal production obviously also looms
large in this and it's the whole other kettle of
fish there, given the sanctions and the potential for relief
of those sanctions if indeed there is a ceasefire deal
in Ukraine. But fundamentally he thinks tariffs will support the
(03:49):
existing domestic industry and incentivize new ones. It's just murkier,
all right.
Speaker 1 (03:56):
We're talking about a lot of terrors being proposed. But Josh,
in the next twenty four hours, maybe none of the
tariffs that we're talking about happen, right, because we both
covered the first term and that pendulum swing.
Speaker 2 (04:07):
I mean it absolutely swings, like you you know very well.
So yeah, as we sit here today, maybe by the
time people listen to this things will have changed. But
I will say Trump has been sturdier on some tariffs
than others. And the steel and aluminum tariffs, those are
on the sturdier end of the spectrum, for sure. He
has been talking about them from the beginning. The other
ones have kind of shifted a bit as the winds blow,
(04:29):
but he really feels strongly about steel and aluminum. I
should note again that the industry groups, in particular on steel,
really support this, and so I would not bet on
much until we start seeing real supply chain snarls or
potentially market impacts.
Speaker 1 (04:42):
So what's the approach here? Can we call what Trump
is doing a strategy of having these announcements and then saying, Okay,
we're going to back down. We hear about a new
threat every week, and then there's reactions from markets and
business leaders and world leaders, and then there's mixed messages.
Is it a strategy?
Speaker 2 (05:00):
What is this? This is a strategy. I think it's
just the rollout has been chaotic. I don't know that
there's any way to say it. Trump and his supporters
see benefit in that, They see benefit in unpredictability, but
markets obviously see much less benefit in that unpredictability. And
so right now, this sort of will he or won't
he is hanging over a lot of things. And if
(05:21):
you're the Americans and you actually do want to steer
investment away from, say Canada and Mexico, having a big
cloud of uncertainty, over Canada and Mexico isn't the worst
thing in the world. So that sort of part helps him.
The whip saw nature of it that we're seeing in markets,
I think is less helpful. And we've seen that from
Republicans saying it publicly. I was talking this week with
Mark Short, who is an aid to President Trump in
(05:43):
his first term and then a very senior aid to
Vice President Pence, who of course is no longer vice president,
and he was saying, you know, in the first term,
Trump got a lot of feedback from people talking about
the benefits of trade, both the economists talking about the
benefits of trade and national security folks talking about the
benefits of trade and keeping your friends your friends. This
time around, Short doesn't see that around him. You've got
(06:04):
a lot of tariff evangelists around the President, who himself
loves tariffs right He talks about it as being his
third or fourth favorite word. So Trump is really jazzed
on tariffs right now. The people around him are jazzed
on tariffs right now. It's not super clear how many
people in the room are saying, I don't know, And
so that's why I think we're seeing this sort of
steady march.
Speaker 1 (06:25):
And what is the message do you think that Trump
is sending to the world by pushing forward with these
medals tariffs now while other broader tariffs remain in limbo.
Speaker 2 (06:36):
The message he wants to send is that America is
back and open for business, and that if you come
here and make stuff here, you will get preferential treatment,
you won't pay tariffs. And remember, of course Republicans are
talking about a tax bill that may lower the corporate
tax rate, in particular even lower for domestically produced goods.
How they measure that, what the content threshold would be
(06:58):
very unclear, so essentially remake the American economy. He talks
in particular pretty nostalgically about industries like steel, in particular
US steel, which of course used to be this mammoth
in America and on the market, but now of course
has fallen on more muted times, to say the least,
And so I think he harkens back to the era
(07:19):
of like an American manufacturing renaissance. The flip side is
that a lot of the manufacturing companies in America right now,
who have factories running as I speak, get a lot
of inputs from abroad. Cheaper inputs that help them remain
competitive with their competitors and other developed economies. And if
we are tarifing those inputs, it risks the businesses that
(07:41):
are already here, It risks the factories and supply chains
that are already here. And of course it could make
goods more expensive. If you make cars in America, solely
in America with American made parts, those cars are going
to be more expensive than is the case now, which
of course will reduce demand for American cars. Trump is
keen about those trade offs, but we should be clear
(08:02):
eyed about those trade offs.
Speaker 1 (08:06):
Coming up. How world leaders are responding to the latest
tariffs and the ripple effects they could have on American consumers.
Trump's promised a lot of reciprocal terrorifts on countries that
impose teriffs themselves on the US. Are we seeing any
(08:29):
major metal exporting countries retaliate for these new tariffs immediately?
Speaker 2 (08:35):
Canadians are retaliating. The Europeans announced theirs within hours.
Speaker 1 (08:40):
On Wednesday, Canadian Finance Minister Dominic LeBlanc described a dollar
for dollar approach. Canada imposed reciprocal tariffs on the US.
We will use every tool at our disposal to defend
Canadian jobs and Canadian businesses and support workers through these
challenging times. In Ursula Vonderleyan the European commit president describe
(09:01):
their countermeasures as strong but proportionate.
Speaker 3 (09:04):
As the United States are applying tariff's worth twenty eight
billion dollars, we are responding with countermeasures worth twenty six
billion euros.
Speaker 2 (09:16):
And this is the risk here because Trump is three
weeks away from announcing what he believes will be reciprocal tariffs.
But when he makes these measures, and in particular with
the way he's making them, he's creating a political dynamic
in these other countries where they are compelled to respond,
their voters would be outraged if they didn't. And then
Trump treats that as an escalation, They respond, he responds,
(09:39):
they respond again, and you can see how this is
going to spiral. And of course his tariff spiral, the
impacts of them spiral, the costs for consumers spiral, the
market fallout spirals.
Speaker 1 (09:49):
Tell me more about that, how is that going to
ripple through the economy.
Speaker 2 (09:52):
Well, right now the US is tiffing. You know some
goods on Canada and Mexico. That's a lot of stuff
that's you know gas if you live in the Midwest,
because the Canada is the number one source of crude
oil imports by the US. That's fruit. I have a toddler.
All I do is buy fruit. Honest to God, that's
like half my life. A lot of agricultural products, of course,
come from Mexico. You know, there's lots of goods that
(10:13):
Americans will pay more for. The Trump team argues that
tariffs are a tax cut for Americans. You will not
find a single economists outside of the Trump administration who
agrees with that tariffs are paid by the importer. This
is a statement of facts. Sometimes the price is reduced
by the seller because they know the importers paying tariffs,
and so, you know, China, Canada makesic It might eat
(10:35):
some of the costs, but fundamentally the dollars are paid
by the importer. Every time Trump imposes a tariff, that
is an import tax paid by American firms. And the
question is how much that will be passed on to consumers,
not if it'll be passed on to consumers. Trump thinks
it'll be worth it because he's envisioning his Golden age,
where you know, manufacturing jobs rebound and you know, salaries
(10:58):
rise and everyone has more money in their pocket. But
the reality of tariffs is that costs rise and everyone
pays that price.
Speaker 1 (11:08):
Well, let's talk about that. Okay, tariffs go into effect.
We have less metal. Do American metals makers have the
capacity to scale up enough to meet the demand.
Speaker 2 (11:17):
Some of them do. Steel for sure has more, but
some steel makers in America rely on scrap from abroad.
Guess what that's tariff now, you know, so their input
stream now has an extra cost associated to it. And
then on aluminum, there is just nowhere near American capacity.
So in the meantime, American companies will just try to
(11:38):
use less aluminum, or they'll simply pay the tariff, which
means they'll pay a tax to the American government to
buy the aluminum that they're using right now. And of
course a lot of things use aluminum, so I think yes,
there is of course going to be an incentive for
companies to establish manufacturing facilities and hire manufacturing workers in
(11:58):
the US. But these things do not turn on a dime.
Speaker 1 (12:02):
Have we heard anything any kind of reaction from American
based manufacturers and reaction.
Speaker 2 (12:07):
To the tariffs Right now? The producers are happy The
people that are unhappy are the other industry groups, everyone
else who needs steel, everyone else who needs illuminum, because
they know that their costs are going up because now
they either are going to a small number of American producers,
who of course have more pricing power right now, or
they pay a tariff and buy abroad, which means paying more.
Speaker 1 (12:29):
US steel, a major American steel producer, is currently in
the middle of a struggle over a potential acquisition by
Japan's Nipon Steel. Court Joe Biden blocked that deal and
Trump opposes it. How does all of this fit into
the picture of these new tariffs.
Speaker 2 (12:45):
The fate of that deal is unclear, and Trump announced
that he would not let Nippon Steel own a controlling
stake in US Steel, but left opening up possibility that
they could have less than that, and he called it
an investment, maybe a minority stake. Our reporting specifically is
that the companies really didn't know what he meant by that,
(13:07):
and there are no talks really around that, and right
now there's a legal fight on going with respect to
President Biden's decision to block it. The Trump team has
not moved to adjust that in any way, and Therefore,
the question for a NIP on steel is do you
want to buy part of US steel? And no one
really knows how that will look, but that is a
good indication of how the mood on steel has shifted.
(13:30):
It is now being treated explicitly as a national security
type of industry. When Trump did that in his first term,
that was more controversial, and now there is more bipartisan agreement.
On steel is like a tactical sector. Trump basically is saying,
you don't need the Japanese to buy you because I'm
going to give tariffs and it's going to prop up
your company in the meantime.
Speaker 1 (13:50):
Josh, as this develops over the next couple of days,
couple of hours, I don't know what are you lying?
Speaker 2 (13:56):
I think the big question is twofold number one, how
many countries he will enact reciprocal tariffs on and how
hogwilde they're going to go in calculating that number? And
number two and watching is the sectoral tariffs. We have
the steel and aluminum ones, but they're not the only ones.
He's teed up some on copper, He's talked about lumber,
(14:17):
He's talked about pharmaceutical drugs, semiconductor chips and hugely autos.
When do those come with what scope, with what exemptions,
at what rate? That is a huge factor I think
in all this. So both of these are allegedly coming,
you know, in a few weeks in April, and so
I think that's why people are watching. All this follows
(14:38):
so closely.
Speaker 1 (14:42):
Thank you for joining, Thank you for having me. This
is the Big Take DC podcast from Bloomberg News. I'm Salaamosen.
This episode was produced by Julia Press. It was edited
by Aaron Edwards, Brendan Murray, and Doug Alexander. Was fact
checked by Adriana Tapia and mixed and sound designed by
(15:03):
Alex Sugia. Our senior producer is Naomi Shaman. Our senior
editor is Elizabeth Potso. Our executive producer is Nicole Beeamster Bower.
Sage Bauman is Bloomberg's head of Podcasts. If you liked
this episode, make sure to subscribe and review The Big
Take DC wherever you listen to podcasts. It helps people
find the show. Thanks for listening.
Bloomberg Audio Studios, podcasts, radio news. President Trump's twenty five
percent tariffs on steel and aluminum imports from every country
in the world went into effect on Wednesday morning, with
no exceptions. The United States of America is going to
take back a lot of what was stolen from it
by other countries and by frankly incompetent US leadership. The
(00:26):
tariffs mark a key piece of Trump's agenda to reshape
US trade from Washington, and a return to a similar
policy from his first term. But just hours after the
tariffs went into effect, Canada retaliated with twenty five percent
tariffs on about twenty one billion dollars of US made products.
The EU hit back two with countermeasures against over twenty
(00:49):
eight billion dollars worth of American goods. Now, investors, automakers,
and American consumers are wondering will these tariffs hold up
and what could their impact to be long term? From
Bloomberg's Washington Bureau, This is the Big Take DC podcast,
I'm Saleamosen. Today. On the show, I'm joined by Bloomberg's
(01:12):
Josh Wingrove to explore what Trump's latest tariffs on steel
and aluminum mean for the US economy and America's relationships
with some of its closest allies. Put this into context
for me, how much does the US rely on the
imports of these metals.
Speaker 2 (01:34):
This is going to be a lot bigger for aluminum
than steel. You know, Steel is a case where there
is existing or a lot more existing capacity that the
industry really wants to lean on. And so the steel
companies and industry groups have generally been for these tariffs
and SLA that's a lot different than a lot of
other industries. Right In autos, for instance, they have been
warning against the tariffs and in fact got the exemption
(01:57):
last week from President Trump on those canes in Mexico tariffs.
It's not only is Canada my homeland, I should say,
the number one source of US aluminum imports. I mean,
it's just huge amounts so to tear if these things.
Trump is obviously, on the one hand, trying to create
an incentive to develop new smelters, which by the way,
(02:18):
are not done quickly and which by the way, use
a lot of electricity. So it's a bit of a
tricky landing to stick. But in the meantime, it's just
simply going to be an extra cost for American companies
that use aluminum, which of course is a wide range
of industries. So these are pretty big ones, and I
should note they're bigger than the first term. I think
people are missing this a little bit right. Trump did
a lot of stuff in his first term, and stealing
(02:40):
aluminum were a big part of it, but there were
exemptions for countries and there were also different rates. What
he's doing here also is raising the rate in illuminum
to twenty five from ten last time it was ten,
so the scope is broader in terms of application. There's
no exclusions. Trump even mused about an Australia exclusion, didn't
give it. And the rate is higher for aluminum. It's
the same steal.
Speaker 1 (03:00):
Where does most of the US's metal supply come from?
What countries?
Speaker 2 (03:05):
That depends what you're talking about. Aluminum is certainly Canada.
Steal is more of a mix, and there's been appetite
to hit some of those countries. And the big concern
on this, of course is China. And the concern is
is Chinese deal kind of sneaking in through Mexico and
Canada or other places. And that's the justification you'll hear
from the White House for these tariffs. Now, those third
(03:26):
party countries, of course their position is, well, if that's
a genuine concern, let's talk about that rather than paint
with a wide brush. Russian metal production obviously also looms
large in this and it's the whole other kettle of
fish there, given the sanctions and the potential for relief
of those sanctions if indeed there is a ceasefire deal
in Ukraine. But fundamentally he thinks tariffs will support the
(03:49):
existing domestic industry and incentivize new ones. It's just murkier,
all right.
Speaker 1 (03:56):
We're talking about a lot of terrors being proposed. But Josh,
in the next twenty four hours, maybe none of the
tariffs that we're talking about happen, right, because we both
covered the first term and that pendulum swing.
Speaker 2 (04:07):
I mean it absolutely swings, like you you know very well.
So yeah, as we sit here today, maybe by the
time people listen to this things will have changed. But
I will say Trump has been sturdier on some tariffs
than others. And the steel and aluminum tariffs, those are
on the sturdier end of the spectrum, for sure. He
has been talking about them from the beginning. The other
ones have kind of shifted a bit as the winds blow,
(04:29):
but he really feels strongly about steel and aluminum. I
should note again that the industry groups, in particular on steel,
really support this, and so I would not bet on
much until we start seeing real supply chain snarls or
potentially market impacts.
Speaker 1 (04:42):
So what's the approach here? Can we call what Trump
is doing a strategy of having these announcements and then saying, Okay,
we're going to back down. We hear about a new
threat every week, and then there's reactions from markets and
business leaders and world leaders, and then there's mixed messages.
Is it a strategy?
Speaker 2 (05:00):
What is this? This is a strategy. I think it's
just the rollout has been chaotic. I don't know that
there's any way to say it. Trump and his supporters
see benefit in that, They see benefit in unpredictability, but
markets obviously see much less benefit in that unpredictability. And
so right now, this sort of will he or won't
he is hanging over a lot of things. And if
(05:21):
you're the Americans and you actually do want to steer
investment away from, say Canada and Mexico, having a big
cloud of uncertainty, over Canada and Mexico isn't the worst
thing in the world. So that sort of part helps him.
The whip saw nature of it that we're seeing in markets,
I think is less helpful. And we've seen that from
Republicans saying it publicly. I was talking this week with
Mark Short, who is an aid to President Trump in
(05:43):
his first term and then a very senior aid to
Vice President Pence, who of course is no longer vice president,
and he was saying, you know, in the first term,
Trump got a lot of feedback from people talking about
the benefits of trade, both the economists talking about the
benefits of trade and national security folks talking about the
benefits of trade and keeping your friends your friends. This
time around, Short doesn't see that around him. You've got
(06:04):
a lot of tariff evangelists around the President, who himself
loves tariffs right He talks about it as being his
third or fourth favorite word. So Trump is really jazzed
on tariffs right now. The people around him are jazzed
on tariffs right now. It's not super clear how many
people in the room are saying, I don't know, And
so that's why I think we're seeing this sort of
steady march.
Speaker 1 (06:25):
And what is the message do you think that Trump
is sending to the world by pushing forward with these
medals tariffs now while other broader tariffs remain in limbo.
Speaker 2 (06:36):
The message he wants to send is that America is
back and open for business, and that if you come
here and make stuff here, you will get preferential treatment,
you won't pay tariffs. And remember, of course Republicans are
talking about a tax bill that may lower the corporate
tax rate, in particular even lower for domestically produced goods.
How they measure that, what the content threshold would be
(06:58):
very unclear, so essentially remake the American economy. He talks
in particular pretty nostalgically about industries like steel, in particular
US steel, which of course used to be this mammoth
in America and on the market, but now of course
has fallen on more muted times, to say the least,
And so I think he harkens back to the era
(07:19):
of like an American manufacturing renaissance. The flip side is
that a lot of the manufacturing companies in America right now,
who have factories running as I speak, get a lot
of inputs from abroad. Cheaper inputs that help them remain
competitive with their competitors and other developed economies. And if
we are tarifing those inputs, it risks the businesses that
(07:41):
are already here, It risks the factories and supply chains
that are already here. And of course it could make
goods more expensive. If you make cars in America, solely
in America with American made parts, those cars are going
to be more expensive than is the case now, which
of course will reduce demand for American cars. Trump is
keen about those trade offs, but we should be clear
(08:02):
eyed about those trade offs.
Speaker 1 (08:06):
Coming up. How world leaders are responding to the latest
tariffs and the ripple effects they could have on American consumers.
Trump's promised a lot of reciprocal terrorifts on countries that
impose teriffs themselves on the US. Are we seeing any
(08:29):
major metal exporting countries retaliate for these new tariffs immediately?
Speaker 2 (08:35):
Canadians are retaliating. The Europeans announced theirs within hours.
Speaker 1 (08:40):
On Wednesday, Canadian Finance Minister Dominic LeBlanc described a dollar
for dollar approach. Canada imposed reciprocal tariffs on the US.
We will use every tool at our disposal to defend
Canadian jobs and Canadian businesses and support workers through these
challenging times. In Ursula Vonderleyan the European commit president describe
(09:01):
their countermeasures as strong but proportionate.
Speaker 3 (09:04):
As the United States are applying tariff's worth twenty eight
billion dollars, we are responding with countermeasures worth twenty six
billion euros.
Speaker 2 (09:16):
And this is the risk here because Trump is three
weeks away from announcing what he believes will be reciprocal tariffs.
But when he makes these measures, and in particular with
the way he's making them, he's creating a political dynamic
in these other countries where they are compelled to respond,
their voters would be outraged if they didn't. And then
Trump treats that as an escalation, They respond, he responds,
(09:39):
they respond again, and you can see how this is
going to spiral. And of course his tariff spiral, the
impacts of them spiral, the costs for consumers spiral, the
market fallout spirals.
Speaker 1 (09:49):
Tell me more about that, how is that going to
ripple through the economy.
Speaker 2 (09:52):
Well, right now the US is tiffing. You know some
goods on Canada and Mexico. That's a lot of stuff
that's you know gas if you live in the Midwest,
because the Canada is the number one source of crude
oil imports by the US. That's fruit. I have a toddler.
All I do is buy fruit. Honest to God, that's
like half my life. A lot of agricultural products, of course,
come from Mexico. You know, there's lots of goods that
(10:13):
Americans will pay more for. The Trump team argues that
tariffs are a tax cut for Americans. You will not
find a single economists outside of the Trump administration who
agrees with that tariffs are paid by the importer. This
is a statement of facts. Sometimes the price is reduced
by the seller because they know the importers paying tariffs,
and so, you know, China, Canada makesic It might eat
(10:35):
some of the costs, but fundamentally the dollars are paid
by the importer. Every time Trump imposes a tariff, that
is an import tax paid by American firms. And the
question is how much that will be passed on to consumers,
not if it'll be passed on to consumers. Trump thinks
it'll be worth it because he's envisioning his Golden age,
where you know, manufacturing jobs rebound and you know, salaries
(10:58):
rise and everyone has more money in their pocket. But
the reality of tariffs is that costs rise and everyone
pays that price.
Speaker 1 (11:08):
Well, let's talk about that. Okay, tariffs go into effect.
We have less metal. Do American metals makers have the
capacity to scale up enough to meet the demand.
Speaker 2 (11:17):
Some of them do. Steel for sure has more, but
some steel makers in America rely on scrap from abroad.
Guess what that's tariff now, you know, so their input
stream now has an extra cost associated to it. And
then on aluminum, there is just nowhere near American capacity.
So in the meantime, American companies will just try to
(11:38):
use less aluminum, or they'll simply pay the tariff, which
means they'll pay a tax to the American government to
buy the aluminum that they're using right now. And of
course a lot of things use aluminum, so I think yes,
there is of course going to be an incentive for
companies to establish manufacturing facilities and hire manufacturing workers in
(11:58):
the US. But these things do not turn on a dime.
Speaker 1 (12:02):
Have we heard anything any kind of reaction from American
based manufacturers and reaction.
Speaker 2 (12:07):
To the tariffs Right now? The producers are happy The
people that are unhappy are the other industry groups, everyone
else who needs steel, everyone else who needs illuminum, because
they know that their costs are going up because now
they either are going to a small number of American producers,
who of course have more pricing power right now, or
they pay a tariff and buy abroad, which means paying more.
Speaker 1 (12:29):
US steel, a major American steel producer, is currently in
the middle of a struggle over a potential acquisition by
Japan's Nipon Steel. Court Joe Biden blocked that deal and
Trump opposes it. How does all of this fit into
the picture of these new tariffs.
Speaker 2 (12:45):
The fate of that deal is unclear, and Trump announced
that he would not let Nippon Steel own a controlling
stake in US Steel, but left opening up possibility that
they could have less than that, and he called it
an investment, maybe a minority stake. Our reporting specifically is
that the companies really didn't know what he meant by that,
(13:07):
and there are no talks really around that, and right
now there's a legal fight on going with respect to
President Biden's decision to block it. The Trump team has
not moved to adjust that in any way, and Therefore,
the question for a NIP on steel is do you
want to buy part of US steel? And no one
really knows how that will look, but that is a
good indication of how the mood on steel has shifted.
(13:30):
It is now being treated explicitly as a national security
type of industry. When Trump did that in his first term,
that was more controversial, and now there is more bipartisan agreement.
On steel is like a tactical sector. Trump basically is saying,
you don't need the Japanese to buy you because I'm
going to give tariffs and it's going to prop up
your company in the meantime.
Speaker 1 (13:50):
Josh, as this develops over the next couple of days,
couple of hours, I don't know what are you lying?
Speaker 2 (13:56):
I think the big question is twofold number one, how
many countries he will enact reciprocal tariffs on and how
hogwilde they're going to go in calculating that number? And
number two and watching is the sectoral tariffs. We have
the steel and aluminum ones, but they're not the only ones.
He's teed up some on copper, He's talked about lumber,
(14:17):
He's talked about pharmaceutical drugs, semiconductor chips and hugely autos.
When do those come with what scope, with what exemptions,
at what rate? That is a huge factor I think
in all this. So both of these are allegedly coming,
you know, in a few weeks in April, and so
I think that's why people are watching. All this follows
(14:38):
so closely.
Speaker 1 (14:42):
Thank you for joining, Thank you for having me. This
is the Big Take DC podcast from Bloomberg News. I'm Salaamosen.
This episode was produced by Julia Press. It was edited
by Aaron Edwards, Brendan Murray, and Doug Alexander. Was fact
checked by Adriana Tapia and mixed and sound designed by
(15:03):
Alex Sugia. Our senior producer is Naomi Shaman. Our senior
editor is Elizabeth Potso. Our executive producer is Nicole Beeamster Bower.
Sage Bauman is Bloomberg's head of Podcasts. If you liked
this episode, make sure to subscribe and review The Big
Take DC wherever you listen to podcasts. It helps people
find the show. Thanks for listening.
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