Did the 2018 steel tariff make US steel production more profitable?
Yes
The 2018 steel tariff made U.S. steel manufacturing more profitable, but at a cost to the greater economy.
The Trump Administration imposed a 25% tariff on foreign steel in March 2018 claiming China unfairly flooded the market by subsidizing its domestic production.
U.S. steel prices subsequently rose and American steelmakers made record profits. In 2019, domestic steel production increased 1.5% while foreign imports declined 15%. American steel and iron mills added 4,800 jobs between March 2018 and March 2019.
But higher steel prices hurt U.S. manufacturers who used steel, prompting layoffs. It is estimated that there are 80 jobs that use steel as an input for every job that produces steel. Other adverse effects included reduced foreign demand, higher prices for U.S. consumers, and retaliatory tariffs.
President Biden announced additional tariffs on “some steel products” in May 2024, citing “China’s unfair trade practices.”
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