US President Joe Biden has ordered that steel items imported from Mexico must be melted and poured in Mexico, Canada or the US to be eligible for Section 232 tariff exemptions. This effectively slaps a 25% tariff on any steel trans-shipped through Mexico that originated in China or other sources outside North America.
In a White House statement, Biden said "these measures will provide an effective, long-term alternative means to address any contribution by Mexican steel articles imports to the threatened impairment of the national security by restraining steel articles imports to the United States from Mexico, limiting transshipment, and discouraging excess steel capacity and production.
"In a presidential proclamation, Biden noted that US domestic steel production utilization rates remain below the recommended 80% threshold due to the effect of imports. The administration is monitoring unfairly traded foreign entries and circumvention of existing tariff orders.
Commerce Secretary Gina Raimondo has determined that "steel articles are being imported into the United States in such quantities and under such circumstances as to threaten to impair the national security of the United States," the proclamation states. It notes that imports of steel articles from Mexico have increased significantly compared to 2019 levels.
Biden's new duty order is effective immediately. Importers will be required to inform US Customs and Border Protection of the melted-and-poured origin of their steel and derivative steel items, a rule that will be implemented "as soon as practicable".