Global Tariff Developments, June 25 – July 3, 2025

A surge of protective measures and retaliatory duties reshaped key supply chains in the final week of June and the opening days of July. For those in North America enjoying holidays here is recap of what’s happened and happening in the next few days

United States

1. Section 232 Metals Tariff Hike

  • Effective Date: June 25, 2025
  • Change: Steel & aluminum imports (all origins except the U.K.) rose from 25% to 50%.
  • Legal Basis: Section 232 national-security authority.
  • Early Impact: Domestic primary-metal producers report a 20% spike in order inquiries. Fabricators warn of rolling price adjustments on downstream products through Q3.

2. Tariff-Stacking Rule Revision

  • Effective Date: June 30, 2025
  • Change: For composite goods containing steel/aluminum, Section 232 duties now fully stack on top of existing IEEPA tariffs instead of offsetting them.
  • Rationale: Close loopholes where metal-intensive products paid only the higher of two overlapping duties.
  • Consequence: Import compliance teams face heightened complexity; several Fortune 500 manufacturers have already sought CBP guidance.

3. Steel Import Quota Extension

  • Announced: June 28, 2025
  • Change: The 2025 annual quota for “low-carbon” direct-reduced iron (DRI) slabs expanded by 150,000 metric tons.
  • Purpose: Secure higher-grade feedstock for emerging green-steel plants in the Great Lakes region.
  • Reaction: U.S. Steel hailed the move, while some independents argue it privileges larger incumbents.

China

Retaliatory Duties on U.S. Exports

  • Effective Date: June 26, 2025
  • Scope: • 25% on U.S. coal, LNG equipment, and select farm machinery • 15–30% on soybeans, pork, and certain dairy products
  • Rationale: Mirror U.S. metals and composite-good tariffs; leverage demand for U.S. ag-commodities.
  • Early Signals: Chinese state buyers are accelerating contracts with Brazil and Russia. U.S. Farm Bureau projects up to $2.3 billion in lost soybean revenues this calendar year.

Canada

Counter-Tariffs on U.S. Goods

  • Effective Date: July 1, 2025
  • Measures: • 25% on U.S. autos, aluminum products, and select consumer items • 10% on U.S. energy exports (natural gas, crude oil)
  • Exemptions: Goods qualifying under CUSMA rules of origin.
  • Industry Reaction: Canadian automakers received limited exemptions conditioned on preserving domestic plants. Ottawa estimates $29 billion in annual U.S. exports subject to the measures.

Cross-Cutting Themes

  • Supply-Chain Fragmentation: Stacking rules and steep hikes are accelerating near-shoring decisions, especially in metals and ag equipment sectors.
  • Tit-for-Tat Escalation: China’s ag duties directly mirror U.S. Section 232 actions, while Canada’s counter-measures underscore the fragility of CUSMA reprieves.
  • Selective Quotas: The U.S. quota extension for low-carbon steel signals industrial-policy coordination on green-steel ambitions.

Here are the potential impacts of each of the upcoming trade deals and tariff negotiations slated between July 3–15, 2025. These agreements could reshape global trade flows, investment patterns, and regulatory alignment across key sectors.

U.S.–U.K. Free Trade Agreement (FTA)

Potential Impacts:

  • Agriculture: U.S. pork and dairy exporters gain phased tariff-free access, potentially boosting exports by 10–15% over five years.
  • Beverages: U.K. Scotch whisky becomes more competitive in the U.S. market, with projected 15% volume growth.
  • Digital Trade: U.K. tech firms benefit from relaxed U.S. data-localization rules, improving cloud-service competitiveness.
  • Geopolitical Signal: Reinforces U.S.–U.K. alignment post-Brexit, potentially pressuring the EU to accelerate its own U.S. negotiations.

U.S.– EU Trade & Technology Council (TTC) Pillars

Potential Impacts:

  • Critical Minerals: Tariff exemptions on lithium, graphite, and rare-earth inputs could lower EV battery costs across both markets.
  • Carbon Border Adjustment Mechanism (CBAM): Harmonization reduces risk of double carbon taxation on steel, cement, and aluminum.
  • EV Supply Chains: Mutual recognition of origin-tracking systems may unlock billions in transatlantic battery investment.
  • Risks: Talks remain fragile—failure to reach agreement by July 9 could trigger 50% U.S. tariffs on EU goods.

U.S.– India “Tariff Pause” Extension

Potential Impacts:

  • Pharmaceuticals: Extension avoids 26% tariffs on Indian APIs and generics, stabilizing U.S. drug supply chains.
  • Steel & Energy: India may gain duty-free access for select steel pipe fittings used in U.S. infrastructure projects.
  • Reciprocity Concerns: Indian exporters worry about asymmetry—U.S. goods may enter India at lower duties, while Indian exports still face baseline U.S. tariffs.
  • Political Optics: A successful extension could signal deepening U.S.–India strategic ties amid China tensions.

EU – Canada Digital & Carbon Framework

Potential Impacts:

  • Digital Services: Phased rollback of 3% digital-services taxes reduces compliance costs for tech platforms by up to CAD 400 million annually.
  • Carbon Markets: Cross-border carbon-credit recognition allows Canadian exporters to offset EU CBAM costs, preserving competitiveness.
  • Clean Energy Trade: Enhanced cooperation on critical minerals and clean tech could boost Canadian exports of nickel, cobalt, and hydrogen tech.

China – Australia Barley & Wine Dispute Settlement

Potential Impacts:

  • Barley: Removal of 80.5% tariffs restores AUD 600–800 million in annual exports to China.
  • Wine: Australian wine exports to China already rebounded to over AUD 1 billion in the 12 months post-tariff removal.
  • Diplomatic Reset: Could pave the way for normalization in other sectors (e.g., lobster, coal, timber) and reduce WTO litigation risks.

Japan- ASEAN Rice Liberalization Initiative

Potential Impacts:

  • ASEAN Farmers: Gradual tariff cuts on Japonica rice open a premium market for Vietnam, Thailand, and the Philippines.
  • Japanese Consumers: Increased rice diversity and lower prices over time, easing pressure from recent domestic shortages.
  • Food Security: Japan balances liberalization with domestic safeguards import quotas and emergency reserves remain in place.

Broader Strategic Implications

  • Supply Chain Realignment: These deals collectively reduce overdependence on China and diversify sourcing for critical goods.
  • Climate & Tech Alignment: Carbon pricing, EV minerals, and digital governance are becoming central to trade architecture.
  • Tariff De-escalation: If successful, these agreements could defuse the July 9 tariff cliff and avert a broader trade war.

Looking Ahead

  1. G7 Trade Ministers (Early July, Japan): Expect consultations on carbon‐border adjustments and harmonized quota frameworks for critical minerals.
  2. EU’s Carbon Border Mechanism (CBAM) Consultation: Stakeholders await late-July drafts that could dovetail with U.S. and Canadian steel/aluminum measures.
  3. Mexico’s Safeguard Review (Mid-July): Watch for possible hikes on U.S. dairy and poultry, echoing Canada’s tactics.