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Relief with a catch: Europe sees scrap leakage risk in US tariff exemptions

EDITED BY : 4MINS READ

The Trump Administration’s latest aluminium tariff hike to 50 per cent has triggered renewed concern among traders and manufacturers over a further shift in trade dynamics to a point where export markets may face a deepening blow. European aluminium producers are neither immune to this strain as worries linger over an increasingly fragile trade environment and fear grows for the further destablisation of trade relations between the two key economic partners.

Relief with a catch: Europe sees scrap leakage risk in US tariff exemptions

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But more than tariff hike, what currently causes sleepless nights to the European aluminium industry is tariff exemption on scrap. Earlier, during the implementation of 25 per cent tariff effective from March 2025, the United States duty exemption on scrap already led to a heavy outflow of the material. Reportedly, the tariff gap had boosted an increased demand for scrap in the US domestic market, intensifying Europe’s supply.

Also read: Trump doubles aluminium and steel tariffs to 50% - how long will it last amid global pushback and renegotiation calls?

Until April 2025, the United States aluminium scrap imports from Europe stood at about 20,000 tonnes, close to the annual export volume of around 22,000 tonnes in 2024. During the first four months of 2024, the United States had imported only a little more than 4,000 tonnes from Europe. People associated with the European aluminium scrap industry believe the exemption of US tariff on scrap has triggered the trade volume of the material.

Based on this trend, the European aluminium industry fears further exemption of 50 per cent tariff will intensify the scrap outflows.

“The outflow of aluminium scrap from Europe is already alarming — and doubling U.S. tariffs will only accelerate it,” says Paul Voss, Director General of European Aluminium. “This puts our recycling industry at serious risk. The Commission must respond immediately by introducing a corresponding duty on scrap exports to the U.S. More broadly, the EU needs to introduce an export fee that applies to all destinations, not just the U.S., to stop scrap leakage and secure access to critical secondary raw materials.”

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