Metal stocks slide as US doubles tariffs to 50% on imports

Shares of Indian steel and aluminium companies fell up to 2.5% in Monday’s trade after the US President Donald Trump will double existing tariffs from 25% to 50% on steel and aluminium products imported into the United States, with effect from June 4, 2025.

On Monday, the shares of Hindalco witnessed the steepest intraday decline among metal stocks, falling by 2.4% to touch a low of 633.35. NALCO and SAIL shares both recorded a 2.2% dip, hitting intraday lows of 176.40 and 126.40, respectively.

The shares of JSW Steel and Tata Steel each slipped 2% in early trade, with JSW Steel touching 993.80 and Tata Steel dropping to 157.65. Jindal Stainless shares saw a decline of 1.6%, hitting a low of 633.35, while NMDC also fell 1.6% to 70.04

Meanwhile, NMDC Steel shares declined by 1.5%, reaching an intraday low of 37.53, and those of Jindal Steel & Power dipped 1.47% to 934.5.

The development has significant implications for India's export-oriented metal sector. As per government data, India exported USD 4.56 billion worth of iron, steel, and aluminium products to the US in FY2025.

The revised tariff structure is expected to directly impact this segment by making Indian products more expensive and less competitive in the U.S. market.

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Of the total USD 4.56 billion in exports, USD 587.5 million came from iron and steel, USD 3.1 billion from articles of iron or steel, and USD 860 million from aluminium and its related products. These products, now subject to sharply increased tariffs, face the risk of reduced demand in one of India’s key export destinations.

The tariff hike was formally announced on May 30, 2025, under Section 232 of the U.S. Trade Expansion Act of 1962, which allows the American President to impose trade restrictions if imports are deemed a threat to national security.

The move revives the trade policy provision first used by Trump in 2018 to impose a 25% tariff on steel and 10% on aluminium, which were then increased to 25% across both categories earlier in February 2025.

As a result of the latest tariff action, US steel prices are expected to surge beyond USD 1,180 per tonne, driving up input costs for several downstream industries, including automotive, construction, and manufacturing. India has already raised a notice at the World Trade Organization (WTO) in response to the decision and may consider further action.

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