Section 232 tariffs are the reason a lot of manufacturers and importers have had to completely rethink their metals supply chain over the past several years. If you import steel or aluminum — or products made from them — these tariffs affect your bottom line. Here's the practical guide.
What Are Section 232 Tariffs?
Section 232 of the Trade Expansion Act of 1962 allows the President to impose tariffs on imports that threaten national security. In March 2018, the Department of Commerce determined that steel and aluminum imports threatened to impair national security, and the President imposed tariffs of 25% on steel and 10% on aluminum. These tariffs apply to imports from most countries, though some have been subject to exemptions or alternative arrangements at various points.
Which Products Are Covered
The original Section 232 tariffs covered basic steel and aluminum products — things like steel slabs, hot-rolled coil, cold-rolled sheet, rebar, wire rod, and aluminum bars, plates, and foil. These fall primarily under HTS Chapters 72 (iron and steel), 73 (articles of iron or steel), and 76 (aluminum and articles thereof).
But the scope didn't stop at raw metals. In subsequent proclamations, the administration expanded coverage to derivative products — downstream goods that are made from steel or aluminum and that could be used to circumvent the tariffs. This brought in products like steel nails, aluminum stranded wire, bumper stampings, and certain fabricated structural components. The derivative product list caught many importers off guard because they didn't think of their finished goods as "steel products."
The Exclusion Process
The Bureau of Industry and Security (BIS) at the Department of Commerce manages a product exclusion process for Section 232 tariffs. Companies can request exclusions for specific products, identified by precise HTS code and physical dimensions, that they cannot source domestically or from exempted countries. The process involves a public comment period where domestic producers can object to the exclusion.
The honest reality of the exclusion process is that it's slow and outcomes are uncertain. Applications can take months to process, and domestic producers frequently file objections claiming they can supply the product — even when the importer's experience says otherwise. Some companies have had success with exclusions for highly specialized alloys or specifications that genuinely aren't available from U.S. producers, but for commodity-grade steel and aluminum, exclusions are rarely granted.
Country-Specific Arrangements
The application of Section 232 tariffs varies by country. Initially, tariffs were imposed broadly, but over time the U.S. negotiated alternative arrangements with several trading partners. Some countries have operated under tariff rate quotas (TRQs) where imports up to a certain volume enter at the regular duty rate, with Section 232 tariffs applying only above the quota. These arrangements have changed multiple times, so the country-specific rules that applied in 2023 may not be the same as those in 2026. Always verify the current status of your source country before assuming an exemption applies.
Impact on Supply Chains
The practical impact of Section 232 extends well beyond the tariff itself. Domestic steel and aluminum prices rose significantly after the tariffs were imposed, since reduced import competition gave U.S. producers more pricing power. Manufacturers who rely on metals as inputs — automakers, appliance manufacturers, construction companies, aerospace suppliers — have faced higher costs regardless of whether they import directly or buy domestically. This cost pass-through is something that doesn't show up in the tariff code but shows up clearly in procurement budgets.
Many manufacturers have responded by qualifying alternative suppliers in countries with more favorable tariff treatment, renegotiating contracts with domestic mills, or redesigning products to use less steel or aluminum. Some have absorbed the cost increases; others have passed them through to customers. The right strategy depends on your specific situation, your margin structure, and your competitive landscape.
How to Check Your Exposure
To determine whether your product is subject to Section 232 tariffs, start with its HTS classification. If it falls under Chapter 72, 73, or 76, check the Chapter 99 cross-references (specifically the 9903.80 range) to see if a Section 232 provision applies. For derivative products, consult the derivative product list in the HTS or search your code on LookupHTS. And remember — Section 232 tariffs can stack with Section 301 tariffs if the product is also from China, so your total additional duty exposure may be higher than you expect.