[Trump Tariffs Ruled Illegal] Steel Industry Still Faces 50% Burden, Will "Continue to Monitor the Situation"

U.S. Supreme Court Rules Tariffs Unlawful
Section 232 of the Trade Expansion Act Unaffected
Heightened Alert Over Growing Tariff Volatility

Although the U.S. Supreme Court has put a brake on President Donald Trump’s imposition of reciprocal tariffs, the existing 50% tariffs on steel and aluminum remain in place, so the burden on the steel industry is expected to continue.

On the 20th (local time), the U.S. Supreme Court ruled that the broad tariffs President Trump imposed on imports from around the world based on the International Emergency Economic Powers Act (IEEPA) were unlawful. The Court held that the authority to impose tariffs belongs exclusively to Congress, and that the import-restriction authority granted to the president under the IEEPA does not extend to tariffs. The reciprocal tariff currently imposed on Korea stands at 15%.

On October 12 last year, steel products were piled up at Pyeongtaek Port in Pyeongtaek, Gyeonggi Province. Yonhap News

While some export items are expected to be affected, the 50% tariff on steel will remain unchanged. This is because tariffs on steel products were imposed under Section 232 of the Trade Expansion Act, not under the IEEPA, and therefore are unrelated to this illegality ruling.

The steel industry says there will be no immediate impact from the Supreme Court ruling, but is remaining highly alert as policy volatility has increased.

Immediately after the ruling, the Trump administration put forward Section 232 of the Trade Expansion Act as a new legal basis to replace the IEEPA. It is also reviewing the application of Sections 122 and 301 of the Trade Act, which are additional tariff tools. Citing Section 122 of the Trade Act, the Trump administration announced that, in place of the reciprocal tariffs that were invalidated on this day, it will impose a 10% tariff for the next 150 days. It also indicated its intention to apply Section 301 to investigate foreign companies and others and then impose additional tariffs, ultimately levying tariffs equivalent in size to the previous reciprocal tariffs.

A steel industry official said, “Since the product-specific tariffs on steel remain at 50% as before, there appears to be no particular impact from this announcement,” but added, “We will continue to monitor how the situation develops going forward.”

Meanwhile, the burden of tariffs on exports to the U.S. has clearly led to a decline in steel exports. According to the Ministry of Trade, Industry and Energy, Korea’s annual steel export value last year was 30.3 billion dollars, down 9.0% from the previous year. According to the Korea Iron and Steel Association, Korea’s steel export volume in October last year was 2,189,490 tons, an 11.3% decrease compared with the same month a year earlier (2,468,922 tons). This was the steepest drop since September 2021, when the COVID-19 pandemic was sweeping across the globe.