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Omar Nashashibi Omar Nashashibi
Founder

The Tariff Supply Chain

June 6, 2025
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President Reagan said, “If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.” Adapting that to today’s economy, one might say, “If it is made in the United States, tariff it. If it was made in the United States, tariff it. And if you want it made in the United States, tariff it.”

Through the first six months of President Trump’s second term, he has kept tariffs and trade policy front and center, impacting all aspects of the global economy. As of May 15, President Trump is believed to have initiated or modified tariffs more than 50 times. 

Before businesses can develop strategies to benefit from the tariffs and mitigate any negative impact, they first must develop a strategy to keep them all straight. The two most recent tariffs that deserve attention: the International Economic Emergency Powers Act of 1977, used to impose tariffs on countries; and the Section 232 national-security tariffs on imported products. We should understand that even as President Trump lifts or reduces tariffs on some nations, the tax on imports may remain on many products due to the 232 tariffs. 

On March 12, the Trump administration began imposing a 25% tariff on steel and aluminum imports using the 232 national security law, as it did in April and then in May for automobiles and automotive parts. Unlike during the first Trump administration, the current 232 actions do not enable U.S. businesses to request an exclusion for products not readily available in the United States, nor do they provide for blanket country exemptions. 

This places manufacturers in a difficult position—if they can find the steel or aluminum, they pay more; if they cannot find it in the United States, they pay a tariff. Per the May 12, 2025, SteelBenchmarker survey of hot-rolled band, U.S. manufacturers pay $634 more per metric ton than their competitors in China, and $299 more than their European counterparts. 

U.S. metalworking manufacturers need relief, or at least some indication of where the White House is headed with its tariff policies. The agreement announced in May between the United States and the United Kingdom could set a precedent for negotiating with other countries. Media reports at the time indicated that Washington would institute a quota system, allowing a set amount of metal, automobiles and parts to enter prior to imposing a tariff.

Unlike his first administration, it appears that President Trump may extend the tariffs beyond the primary goods to include their derivatives—products made from steel or aluminum. Their inclusion in Section 232 investigations would represent a significant expansion of U.S. trade enforcement under national security provisions. Such action, being considered by the Commerce Department, would eliminate the IEEPA tariffs in favor of the 232 rates. 

Now that future Section 232 tariffs may also include derivatives, countries granted a quota for a specific product could stretch beyond that import to other products. 

PMA recently filed comments with the U.S. Department of Commerce raising concern over the inclusion of copper derivatives in a potential tariff action that not only would cover the copper itself but also imported nickel, as well as brass, bronze and other copper alloys.

Additional possible tariff actions announced this spring also include derivative products and related sectors of critical minerals and semiconductors. The U.S. Geological Survey identifies 50 minerals as critical, including those used to produce steel, aluminum and red metals. In April and May, President Trump instructed his administration to launch investigations into these essential inputs, in addition to 232 actions considered on aircraft and their parts; medium- and heavy-duty trucks and many of their key components; as well as pharmaceuticals and timber.

While many around the country and media focus on the president’s April 2 Liberation Day tariffs, do not lose track of the expanded use of the Section 232 law to impose tariffs on imports and their derivatives. For countries other than China, Canada and Mexico, the Liberation Day announcement resulted in an average 23% tariff, which the president subsequently lowered to 10% through July 9, 2025. Lacking any agreement with each country, on July 10 at 12:01 a.m. ET, the higher tariff rates from the April 2 announcement take effect. The tariff rate for Vietnam is 46%, 25% for South Korea and 24% for Japan, with the entire European Union under the cloud of a 20% tariff. Relief for those countries and for importers of their goods only will arrive if President Trump reaches an agreement with individual nations or extends the suspension of the higher tariff rates. 

The uncertainty over whether the tariffs on countries will increase during the summer has caused many OEMs and their suppliers to pause or slow investments. At a time when manufacturers look for certainty, the months ahead may not deliver it. 

There are ways for businesses to capitalize on the uncertainty. Understand which tariffs impact your business the most, identify how you can help mitigate the impact of tariffs on your customers, and work with your suppliers to reduce current and future exposure to tariff risk. Learn to incorporate tariffs into your strategies, as it is clear that this president is committed to tariffs playing a central role in our economy, whether we make it here, used to or should.

Omar Nashashibi is the founder of Inside Beltway, a non-partisan, Washington, D.C.-based lobbying and strategic-consulting firm.

Industry-Related Terms: Brass, Center
View Glossary of Metalforming Terms

 

See also: Precision Metalforming Association

Technologies: Management

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