President Joe Biden has proposed a tripling of the tariff rate on steel and aluminum from China from 7.5% to 25%.

Speaking at an event with U.S. Steel workers in Pittsburgh Wednesday, he said the U.S. Trade Representative is investigating claims of uncompetitive Chinese trade practices and promised to keep U.S. Steel an American-owned and -operated company with American workers. 

What You Need To Know

  • President Biden proposed a tripling of the tariff rate on steel and aluminum from China

  • The president has asked the U.S. Trade Representative to consider increasing the current average tariff from 7.5% to 25%

  • China makes almost 50% of the steel that is used globally and sells it at prices that are about 40% lower than U.S. steel

  • Biden also said U.S. Steel "should remain a totally American company" in the face of a Japanese takeover

"I’m not looking for a fight with China. I’m looking for competition — but fair competition," he said. "For too long, the Chinese government has poured state money into Chinese steel companies, pushing them to make as much steel as possible subsidized by the Chinese government."

China makes almost 50% of the steel that is used globally, according to a senior administration official. While Chinese steel accounts for 0.6% of U.S. demand, the official said China is producing more than it can use domestically or the world can easily absorb. China’s export steel prices are about 40% lower than U.S. steel prices.

Biden said the last time Chinese steel flooded the market was in the early 2000s, causing more than 14,000 steel workers in Pennsylvania and Ohio to lose their jobs.  

The United States already imposes tariffs on Chinese steel. To triple them, the U.S. Trade Representative needs to approve the proposal.

Five labor unions, including the United Steelworkers, petitioned Trade Representative Katherine Tai to investigate Chinese policies and practices in the maritime, logistics and shipbuilding industries. They said the Chinese government is engaging in aggressive, non-market policies.

"If that investigation confirms these anti-competitive trade practices, then I'm calling on her to consider tripling the tariff rates for both steel and aluminum imports from China," Biden said.

China has been importing steel and aluminum to the United States through Mexico to avoid paying the tariff, Biden said. A U.S. delegation was in Mexico on Tuesday to meet with  Mexican president Andres Manual Lopez Obrador to address the issue.

The proposed actions to combat Chinese steel imports come days after Treasury Secretary Janet Yellen met with senior officials in China to address concerns about overcapacity in a variety of industries, including steel.

Following up on a statement Biden made last week, Biden reiterated his opposition to Nippon Steel’s $14 billion acquisition of U.S. Steel.

"U.S. Steel has been an iconic American compay for more than a century, and it should remain a totally American company," he said. "That's gonna happen. I promise you."

Despite 98% of U.S. Steel shareholders approving the deal, the Department of Justice needs to clear the merger.