An Article to Understand How China's Aluminum Semis Tariffs on U.S. Exports Are Calculated [SMM Analysis]

From May 10 to 11, US Treasury Secretary Scott Bessent and US Trade Representative Jamieson Greer held a new round of tariff negotiations with Chinese Vice Premier He Lifeng in Geneva. Both sides agreed to uniformly reduce the EO 14257 "reciprocal tariff" to a 10% baseline within 90 days and suspend further increases. Additionally, the implementation of the remaining 24% tariff was suspended for 90 days.

The Section 232 tariffs, which are designed to protect the US domestic steel and aluminum industries, as well as the Section 301 tariffs targeting China, were not addressed in this round of negotiations. Therefore, the 25% tariff imposed by the US on steel and aluminum products remains unchanged, but this round of negotiations has left room for further negotiations on possible "substantial tax reductions".

It is worth noting that the US has also retained a 20% "fentanyl tariff" specifically targeting Chinese goods valued at less than US$800 entering the US through international mail or express delivery channels, in an effort to combat the smuggling of chemical precursors. Industrial-grade aluminum semis are typically cleared through regular sea or air freight customs declarations, so this tax surcharge has no substantial impact on the tax burden of aluminum industry exports.

So, how many layers of tariffs are currently imposed on aluminum semis directly exported from China to the US? What are the final tariff rates for each product?

Currently, there are five main layers of tariffs:

1. MFN (Most Favored Nation) tariff rates – the "first threshold" universally applicable to all WTO members;

2. Section 301 additional tariffs on China – only targeting aluminum semis of Chinese origin, with tariff rates of 25% or 7.5% depending on the list;

3. Section 232 steel and aluminum tariffs – starting from March 12, 2025, the US will impose a 25% tariff on all imported aluminum and aluminum semis;

4. EO 14257 reciprocal tariff – currently exempted, temporarily set at 0%;

5. AD/CVD trade remedy measures – imposing anti-dumping (AD) and countervailing duty (CVD) deposits on specific categories such as extruded profiles, aluminum sheets, and aluminum foil.

Summary of currently effective anti-dumping/countervailing products:

Quick reference for typical products:

*AD/CVD items are subject to the latest announcements from the US Department of Commerce and the International Trade Commission.

In 2024, China's direct exports of aluminum semis to the US accounted for only 4.08% of total exports. Therefore, the tariff war had a relatively small impact on the direct exports of aluminum semis. However, for some terminal finished products, such as home appliances, electronics, and auto parts, if they are not included in the Section 301 or Section 232 lists, they will be subject to the 10% tariff under the current Sino-US negotiation agreement. Additionally, the 24% 90-day suspension window may stimulate a rush in exports, thereby boosting aluminum demand in the short term. SMM will closely monitor recent downstream production and order situations.