Steel Truce In Sight? US, Mexico Reportedly Close To Slashing Tariffs With New Quota System

The United States and Mexico are reportedly close to a deal that will remove the 50% tariffs imposed by the Trump administration on steel imports up to a specific volume.

According to a Bloomberg report, citing people familiar with the matter, the conversations are being led by Commerce Secretary Howard Lutnick. Trump has not been involved in any direct talks, but will reportedly provide the final approval for any deal.

The report stated that the agreement, in its current form, will permit U.S. importers to bring in Mexican steel as long as the total shipments remain below a level based on historical trade volumes.

The new cap is anticipated to be higher than the level established during Trump's first term.

Another Reuters report said that it has not yet been decided whether tariffs will be scrapped altogether for volumes under the agreed quota or reduced to lower levels.

Nucor (NUE) and Cleveland Cliffs (CLF) stocks were down 4.6% and 4.2%, respectively.

According to the Commerce Department data, Mexico was the third-largest source of steel imports into the U.S. in 2024, with shipments totalling 3.2 million metric tons. Another neighbor, Canada, was the top provider of foreign steel with 5.95 million metric tons last year.

Earlier in the day, Mexican Economy Minister Marcelo Ebrard reportedly stated that his team had informed the Trump administration that the tariffs were unfair, as the U.S. has a trade surplus in steel with Mexico.

“We are waiting for their response, because on Friday we gave them the details of Mexico’s argument, and we are right,” Ebrard reportedly said.

Retail sentiment on Stocktwits about major U.S. steelmakers was in the ‘bearish’ territory.

Some retail traders were wondering if a similar deal with Canada was possible.

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Cleveland Cliffs stock has fallen 15.8% this year, while Nucor stock is up nearly 6%.

Also See: US-China Agree On Roadmap To Ease Trade Friction, Even As Appeals Court Backs Trump Tariffs

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