Global trade war is about to escalate? Trump wants to double the tariffs on steel and aluminum to 50%.

Donald Trump, the President of the United States, announced on Friday local time during his visit to a US Steel Corp. factory, which is set to be acquired by the Japanese steel industry giant Nippon Steel, that he plans to significantly increase tariffs on steel and aluminum from the previous and already effective rate of 25% to 50%, stating that this move will help protect American workers. Trump visited a factory near Pittsburgh on Friday to support a major anticipated acquisition between US Steel Corp. and Nippon Steel Corp., and claimed that the deal will ensure that this iconic American company remains owned and operated by Americans, even though many details of the acquisition agreement are still unclear. He stated that the increased steel tariffs will benefit the American operations of this new joint venture. Reports indicate that the Trump administration is making final arrangements to approve Nippon Steel's acquisition of US Steel Corp. as a wholly owned subsidiary. Sources have revealed that in order to ensure a certain level of intervention and influence by the US government over the operations of US Steel Corp., Japan Steel will sign a "national security agreement" with the US government. "I believe everyone who just made the decision to invest in America resolution are now very happy, because this means that no one can steal your industry anymore," Trump said. "At 25% tariffs, they can still barely climb over this barrier; if it's raised to 50%, they won't be able to climb over anymore." In this event, Trump announced an increase in tariffs on imported steel products, and posted on his Truth Social platform after the meeting that he will also raise tariffs on aluminum products. The post mentioned that the new tariff rates are expected to take effect on "Wednesday, June 4." The era of 50% steel and aluminum tariffs is coming? Trump's plan to further increase tariffs on steel and aluminum has drawn a conclusion to this week's tariff policy turmoil, indicating that the trade war globally is not easing and may become more intense. Prior to this, the Trump administration's broad "reciprocal tariffs" were ruled illegal by the US Trade Court, but the appeals court subsequently issued a stay, temporarily upholding the Trump administration's tariff measures. However, insiders have indicated that the Trump administration has prepared a so-called "plan B" to continue implementing global tariff policies to prevent further judicial intervention. The new 50% tariff rate also supports Trump's commitment to the acquisition of US Steel Corp. by Nippon Steel. This deal - which he opposed during his campaign, is now viewed as benefiting steelworkers in the key swing state of Pennsylvania. The United Steelworkers union had opposed the deal, fearing that Japanese ownership could lead to production cuts and job losses, but Trump assured the workers that the US will still have ownership and emphasized that the cooperation between Nippon Steel and US Steel will create job opportunities and economic benefits, and the US Steel capacity will not be reduced for a period of time, nor will production facilities be moved overseas. "A lot of money will flow to you." Trump added. He made a speech in front of a banner with the words "Golden Age", "American Steel", and "American Jobs", reiterating that his policies will bring economic prosperity. Benefiting from Trump's desire to further raise steel and aluminum tariffs, in after-hours trading on the US stock market, shares of American steel companies such as Nucor Corp., Cleveland-Cliffs Inc., and Steel Dynamics Inc. all surged significantly. Cleveland-Cliffs rose more than 15%, while Steel Dynamics and Nucor rose at least 5%. Trump stated that the workers of US Steel Corp. will soon receive a $5000 bonus, and mentioned that of the proposed $14 billion investment in acquisitions, $2.2 billion will be used to increase production at the Mon Valley Works steel company where he gave his speech. Trump stated that $7 billion will be used to modernize steel plants, expand mining, and build new facilities in Indiana, Minnesota, Alabama, and Arkansas. He also stated that even if US Steel Corp. is immediately acquired, there will be no announcements of layoffs or outsourcing, and blast furnaces will operate at "full capacity" for at least 10 years. According to Morgan Stanley statistics, about 17% of steel demand in the US relies on imports, mainly from Canada, Brazil, and Mexico. Construction companies warn that tariffs may raise critical building material costs, reduce supply, and increase new home construction costs. The event had a "victory parade" atmosphere, with Trump receiving a Pittsburgh Steelers jersey and a golden safety helmet during the visit. Although the atmosphere was enthusiastic, key details of the deal were still unclear before the event on Friday. Investors are eager to understand the specific terms of the agreement between the parties after Trump announced last week that he had approved the acquisition deal. Trump's attitude towards Nippon Steel's acquisition of US Steel Corp. has made a major reversal Trump's decision marks an astonishing reversal of his stance; he strongly opposed the deal during his campaign, but attributed this change to concessions made by Nippon Steel that will benefit American steelworkers. "Every time they come in, the deal gets better and better for the workers," Trump said, emphasizing that the headquarters of US Steel Corp. will still be in Pittsburgh. Last week, Trump described the deal as a "planned partnership" that will bring investment to America, rather than a complete sale of an American company. While the deal was announced by Trump last week, the two parties are still negotiating specific terms, including what veto power the US government will retain on the board of US Steel Corp. "In Washington, I will supervise the whole process, and this deal will be great," Trump said. Friday's event marked a phase in the long and controversial process of Nippon Steel's acquisition of this iconic American heavy industry company. Nippon Steel initially proposed to acquire the US Steel for $14.1 billion, and from the current perspective of the Trump administration, the size of the acquisition is not expected to change significantly. "The commitment has been made," said Representative Dan Meuser, a Pennsylvania Republican, interviewed at the Irvin plant before Trump's speech."They won't smash this deal," he added, calling it "almost a done deal."The deal submitted to the Committee on Foreign Investment in the United States (CFIUS) includes an initial purchase price of $55 per share and additional investments, according to sources familiar with the matter. According to sources, under the agreement, the U.S. government will retain certain powers, including the authority to decide on board members. Pennsylvania Republican Senator David McComick referred to this arrangement as "golden shares," and it is still unclear whether this means ownership or just giving the government intervention rights. In an interview with CNBC, McComick stated that the structure would involve a "U.S. CEO, a majority of U.S. board members, with a golden share that basically requires the U.S. government's approval of several board members to ensure that production levels are not reduced." Both Donald Trump and former President Joe Biden opposed the deal during the 2024 presidential election, arguing that the U.S. steel company should remain in American hands. Biden vetoed the deal citing national security concerns, and Trump ordered a review of the decision upon taking office and announced a partnership last week. Advocates in support of the acquisition deal between Nippon Steel and the U.S. steel company have long argued that the Japanese company will help revive this traditional American business through investments. The next steps to complete the deal are not entirely clear. Both parties will need to finalize the agreement through the CFIUS review process. It is currently unclear whether any text of a "mitigation agreement" has been finalized this agreement may specify which powers the U.S. government will retain. The acquisition initiated by Nippon Steel is seen by some Republican legislators as a "rescue" mission for the U.S. steel industry, injecting funds and advanced electric arc furnace technology to help the American steel industry gain new vitality in future market competitions.