10-02-2025
Here's how Trump's new tariffs on steel and aluminum will affect NJ consumers, businesses
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President Donald Trump has vowed imposing 25% tariffs starting Monday on steel and aluminum imports into the United States, a move which experts say will have far-reaching impacts on business owners and average consumers in New Jersey.
"It's time for the United States to return to the system that made us richer and more powerful than ever before," Trump said over the weekend. He is expected to formally announce the tariffs Monday afternoon.
Economists warn that tariffs, which are taxes on foreign imports, can lead to higher prices for consumers. Trump promised during his campaign to bring down inflation. But one week into his second term, Trump has shown he plans to use tariffs — a hallmark of his first term — as a tool to achieve both his foreign policy aims and domestic agenda.
In New Jersey, the new tariffs on metals would affect everything from construction projects to grocery shopping, manufacturing and pharmaceuticals, experts say.
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'There is no upside' in the state, said Thomas Prusa, an economist at Rutgers University in New Brunswick who studies international trade.
Earlier this month, Trump promised blanket 25% tariffs on imports from Canada and Mexico, a move he claimed would clamp down on the flow of migrants and fentanyl over the U.S borders.
Trump later agreed to put those tariffs on hold for a month, but went ahead with 10% tariffs on Chinese imports.
'Once you put on tariffs, business slows down, investment slows down, decisions slow down," Tom Clark, the Canadian consul general in New York, told "They would anticipate that there would be a slowdown of economic traffic.'
Where does the U.S get its steel?
In 2024, 23% of all steel used in the U.S. was imported, with Canada, Brazil, Mexico, South Korea and Vietnam as the largest suppliers, according to the American Iron and Steel Institute. The U.S gets most of its aluminum imports from Canada, Reuters reported.
Even with domestically-sourced steel and aluminum, the fear is that those producers would 'feel they're emboldened to raise prices,' said Eddie Russnow, president of Kearny-based Mac Products, which makes electrical distribution and transmission products.
Russnow's firm was 'ordering forward" with its Chinese suppliers for the steel and copper used for many of Mac's components.
And even if the tariffs do boost U.S. production of steel and aluminum, that could take years, said Prusa, the Rutgers trade economist.
Higher costs on construction
Steel is used primarily on commercial construction — warehouses, garages and office space — said Prusa.
It's used to a lesser extent in residential construction for heating, ventilation and air conditioning, as well as pipes.
More:NJ companies worry consumers will spend less due to fear of Trump's tariffs
In building construction, steel is used in 'beams, roofing, brackets and reinforcing,' he said, as well as in key infrastructure, such as bridges, railings, railways, lighting, and safety barriers. Think of the huge Gateway project underway to build a new train tunnel beneath the Hudson River between North Jersey and Manhattan to improve service for NJ Transit and Amtrak riders.
Potential for costlier pharmaceuticals
Aluminum is used in packaging for medication, Prusa said.
It's also used in certain consumer products, including antacids, astringents, aspirin, food additives, antiperspirants and cosmetics, according to the federal Centers for Disease Control and Prevention.
New Jersey-based drugmaker Johnson & Johnson produces some antacids, such as Pepcid Complete, while Bayer, which has many facilities in Morris County, is the largest producer of aspirin.
Johnson & Johnson is also one of the world's largest producers of cosmetics, including beauty products for skin care and hair care.
What about Trump's previous tariffs on steel and aluminum?
Trump imposed tariffs on steel and aluminum in 2017. But he reached a deal in 2019 to lift those tariffs on Mexico and Canada. There were also exemptions for South Korea and Australia.
The tariffs reduced the import of steel to the U.S by 24% while increasing domestic steel production by 1.9%, according to a 2023 report by the U.S International Trade Commission.
And, the report added, tariffs pushed the price of steel up by 2.4%.
Prices of aluminum foil peaked in June 2018 amid the tariffs, according to data from the St. Louis Federal Reserve Bank.
This article contains information from USA Today
Daniel Munoz covers business, consumer affairs, labor and the economy for and The Record.
Email: munozd@ Twitter:@danielmunoz100 and Facebook
