Trump’s new tariffs could restrict scrap supplies to the US from the EU

The proposed 30% tariff on imports from Europe to the US could deal a serious blow to the supply chains of ferrous scrap for American steel producers using electric arc furnaces (EAFs). This was reported by Argus.Media.

The Netherlands, Poland, and Sweden are among the key suppliers of high-quality scrap to the US. According to US Customs, 222,000 tons of scrap were imported from the EU in January-May 2025, accounting for almost a third of the total volume, which is 94% more than in January-May 2024. At the same time, a 10% duty on imports of iron-bearing raw materials from Europe was introduced in early April, but its impact on the market has so far been limited. The new tariffs could significantly reduce supply volumes.

This decision follows the announced 50% duty on imports of pig iron from Brazil, the largest supplier of this raw material to the US (about 70% of the volume). If both restrictions come into force, American manufacturers will be forced to radically change the logistics of supplying scrap and raw materials for steelmaking.

Among the alternatives are supplies from Canada (31% of imports), Mexico (28%), and the United Kingdom (13%). However, these countries also face internal challenges. In particular, tariffs on steel and automobile imports from Canada and Mexico have already reduced production and scrap generation. At the same time, limited production capacity in the United Kingdom does not allow for compensation for losses from reduced supplies from continental Europe.

Thus, if new tariffs are introduced, there may be a shortage in the US scrap market, which will lead to higher prices and increased production costs for EAF plants.

As a reminder, in 2024, scrap exports from the European Union to third countries decreased by 10.8% compared to 2023, to 16.72 million tons. In 2023, the figure grew by 7% y-o-y – to 18.7 million tons, and in 2022, it fell by 10% y-o-y to 17.6 million tons — for the first time after more than six years of upward trend. More than 60% of total exports last year went to Turkey – 10.62 million tons (+1.7% y/y).