Transatlantic Trade Tensions Rise Over New “Steel Derivative” Levies

New transatlantic trade tensions are flaring as the US prepares to levy tariffs on 700 additional goods, from bicycles to baking trays. This “steel derivative” policy is causing alarm in Europe, where industry leaders fear it undermines existing trade pacts with the UK and EU.
The policy allows US companies to request tariffs on imported goods that contain steel. American firms like Guardian Bikes and Red Gold have successfully argued that they are at an “unfair” disadvantage because they pay tariffs on raw steel, while importers of finished goods do not.
This second round of requests follows a highly successful first round in August, which saw 407 items added to the list. The near-100% approval rate from the Commerce Department has spurred this new, larger wave of applications, which were due October 21.
European exporters are frustrated, as they had already agreed to new trade frameworks with the US. These deals included baseline tariffs of 10% (UK) and 25% (EU). The new derivative tariffs would be in addition to these rates, a move one expert said “makes a mockery” of the agreements.
A decision on the 700 items is expected in December or January. An analyst at Flint Global called the US policy “expansionist” and noted it speaks to “the uncertainty in the relationship” with European allies, despite the deals.