Japan Pleads for U.S. Tariff Exemption on Steel, Aluminum

• Japan has formally requested the U.S. for an exemption from the 25% tariffs on its steel and aluminum products.
• The request was made in response to U.S. President Donald Trump’s vow to implement these penalties next month.
• The tariffs are scheduled to take effect on March 12, and any shipments exceeding Japan’s quota would be subject to tariffs.
• The outcome of this situation will have far-reaching implications for the global steel and aluminum industry, and more broadly, for the global economy.

In a significant development, Japan has formally requested the United States for an exemption from the 25 percent tariffs on its steel and aluminum products. This move is a response to U.S. President Donald Trump’s vow to implement these penalties next month. The announcement was made by the government’s top spokesperson, Chief Cabinet Secretary Yoshimasa Hayashi.

The request for exemption was officially made through the Japanese Embassy in the United States. This diplomatic move underscores the seriousness of the situation and the potential impact it could have on Japan’s economy.

Prime Minister Shigeru Ishiba, who had a meeting with President Trump last week, addressed the issue in parliament. He stated, We will take necessary measures, including lobbying the United States for an exemption, while closely monitoring any possible impact on the Japanese economy.

Japan’s Proactive Approach and Economic Impact

The tariffs are scheduled to take effect on March 12, as per the White House. This is President Trump’s first sector-based tariff order since he assumed office last month. It is worth noting that during his first presidency in 2018, Trump had imposed tariffs of 25 percent on steel and 10 percent on aluminum. These tariffs were justified on the grounds of national security concerns.

However, under the administration of Joe Biden, several U.S. trading partners, including Japan, were granted duty-free quotas. Japan’s quota was set at 1.25 million tons per year starting in April 2022. Any shipments exceeding this amount would be subject to tariffs.

This policy change by President Trump on Monday, which involved the removal of these exceptions, has prompted a vow of retaliation from the European Union. This development has added another layer of complexity to the already intricate web of international trade relations.

In terms of economic impact, Japan’s U.S.-bound steel exports totaled 302.6 billion yen in 2024, accounting for 1.4 percent of the total export value to the United States. Aluminum and other related products amounted to 26.4 billion yen, according to Finance Ministry data.

Historical Context and Future Implications

This situation is reminiscent of the 2002 steel tariff imposed by the U.S. under President George W. Bush. The tariff, ranging from 8% to 30%, was applied to a range of steel products from several countries, including Japan. The move was met with a wave of retaliation and led to a case at the World Trade Organization, which ruled against the U.S. The tariffs were eventually withdrawn in December 2003.