Donald Trump slaps 50% tariff in steel war. Here’s what it means for India’s producers

President Donald Trump announced a doubling of tariffs on steel and aluminium imports to 50 percent, escalating his protectionist trade agenda amid rising US metal prices and a controversial pivot on the future of US Steel.

Speaking at US Steel’s Mon Valley Works–Irvin plant in Pennsylvania, Trump declared the new tariffs will take effect Wednesday. “We are doubling down on American steel,” he said, while standing in front of cheering workers. The aluminium tariff will see a similar hike.

The move comes as domestic steel prices surge, up 16 percent since Trump’s return to office in January. In March, US steel stood at $984 per metric tonne, far above Europe’s $690 and China’s $392, according to the Commerce Department.

Trump’s tariff decision coincides with a major development in the ongoing US Steel-Nippon Steel saga. After long opposing foreign ownership of the iconic steelmaker, Trump reversed course last week, now backing a “partial ownership” structure by Japan’s Nippon Steel. Full deal terms remain undisclosed.

“This storied American company stays an American company,” Trump told plant workers. “You’re going to stay an American company, you know that, right?”

Federal and state officials say the agreement includes Nippon acquiring US Steel while pledging multibillion-dollar investments in facilities across five states—Pennsylvania, Indiana, Alabama, Arkansas, and Minnesota. 

It would feature a US-based leadership team and board, with a “golden share” mechanism giving Washington veto authority over key decisions.

The tariff hikes are poised to shake global trade dynamics. Steel and aluminium exports from major producers like the EU, China, and Brazil, now largely locked out of the US market, are expected to flood alternative destinations, including India.

Analysts warn of a growing risk that India, already grappling with global overcapacity, may face increased dumping of cheap steel. This could squeeze domestic prices and margins. India has imposed anti-dumping duties on certain steel products from China, Vietnam, Korea, and Thailand to cushion the impact.

Stocks to watch
India’s metal sector is showing a mixed outlook as technical signals suggest short-term bullish momentum, while fundamental pressures loom.

Tata Steel broke a falling trendline on weekly charts with an RSI of 70.19, prompting buy calls at ₹150.90 with a target of ₹157.50. However, its Q4 FY25 net profit dipped 5.61% due to high coking coal costs and European market weakness.

In contrast, JSW Steel posted a 15.7% year-on-year rise in net profit to ₹1,503 crore, aided by cost optimization and stronger EBITDA margins, though its 12.43% annual return trails the Nifty Metal index’s 84.37%, reflecting debt and capex-related caution. SAIL, reeling from an 18% stock dip in April, recovered 13.6% in May on hopes of demand resurgence and has urged anti-dumping measures as global prices slump below ₹47,000/tonne.

The Nifty Metal index, which slid 8% in April, rebounded 4.78% following U.S. tariff suspensions. Stocks like Vedanta (P/E 12.57) trade below the sector average, while Hindustan Zinc’s 6.33% dividend yield is offset by a negative ROE. For short-term traders, Jindal Steel & Power shows breakout potential to ₹1,008, and Tata Steel remains technically strong. Long-term bets include APL Apollo Tubes and Ratnamani Metals as per some experts.