President Donald Trump has announced a 25% tariff on all steel and aluminum imports into the United States, a move that will end exemptions for major trade partners Canada, Mexico, Brazil, and the European Union. The new tariffs, expected to take effect next month, are raising concerns across multiple industries about potential price increases for consumers.
Impact on Canned Goods and Beverages
The U.S. canned food industry, which imports around 70% of its steel, is expected to face significant cost pressures. Major food companies, including General Mills, Del Monte, and Goya, have warned that higher steel prices will likely lead to increased grocery prices.
Robert Budway, president of the Can Manufacturers Institute (CMI), expressed concerns that without exemptions, the tariffs could undermine food security and disrupt the supply chain.
“While the president may believe that these tariffs are protecting the steel industry, they certainly are undermining our food security and supply resiliency,” Budway said.
Similarly, the beverage industry, including Coca-Cola and major brewers, has cautioned that higher aluminum costs will drive up production expenses. Coca-Cola CEO James Quincey acknowledged that while the company could mitigate the impact, increased prices were still a possibility for consumers.
Automotive Industry Warns of Higher Car Prices
U.S. automakers, which rely heavily on imported metals, have also sounded the alarm. The last round of Trump-era steel and aluminum tariffs in 2018 resulted in a $1 billion cost increase for manufacturers such as Ford and General Motors.
According to Morningstar analyst David Whiston, a similar price hike could occur this time, potentially adding around $300 per vehicle for consumers. However, with automobile sales still below pre-pandemic levels, manufacturers may be hesitant to pass the full cost onto buyers.
Michael Wall, an auto industry expert at S&P Global Mobility, warned that the tariffs could lead to higher costs trickling down to consumers. He noted, however, that the real risk comes from Trump’s broader tariff proposal on all imports from Canada and Mexico, which is currently on hold until March.
If those tariffs are implemented, TD Economics estimates that vehicle prices could rise by up to $3,000.
Ford CEO Jim Farley called Trump’s trade moves “a lot of cost and a lot of chaos” for the auto industry.
Construction and Housing Market to Feel the Squeeze
The construction industry, one of the largest users of steel, is also set to suffer from rising material costs. Carl Harris, chairman of the National Association of Home Builders, criticized the tariffs, saying they run “totally counter” to Trump’s stated goal of making housing more affordable.
“Ultimately, consumers will pay for these tariffs in the form of higher home prices,” Harris said.
The homebuilding and appliance sectors are bracing for cost increases. After the 2018 steel tariffs, Whirlpool reported a $350 million jump in production costs due to higher steel prices.
While some companies may absorb the added costs, many industry leaders expect retail prices to increase, affecting everything from appliances to home construction materials.
Uncertain Future for U.S. Trade Policy
Trump has rejected calls for exemptions, insisting that all steel and aluminum imports must face the same tariff rules. However, some industries hope he will reconsider before the tariffs take effect.
With businesses across multiple sectors warning of higher prices, it remains to be seen whether consumer costs will rise significantly or if companies will find ways to absorb the financial hit. Either way, Trump’s latest trade policy move is already creating uncertainty for industries and markets alike.
