Commerce Seeks Input on Tariff Adjustments for Steel and Aluminum Producers Supporting US Auto Manufacturing Under Proclamation 10984
The Department of Commerce's International Trade Administration is seeking public comments on proposed information collection procedures related to tariff adjustments for steel and aluminum imports. This request, announced in the Federal Register on August 21, 2026, pertains to a program established under Proclamation 10984. This program allows certain Canadian and Mexican producers to reduce tariffs by committing to increase U.S. production of critical metals. This development highlights the federal government's continued use of trade measures to bolster domestic industrial capacity and reinforce national security supply chains for key sectors like the automotive industry.
Background on Section 232 Tariffs and National Security
This current initiative builds upon a series of presidential actions taken under Section 232 of the Trade Expansion Act of 1962, which authorizes the President to adjust imports if they are deemed to threaten national security. In 2018, President Trump issued Proclamation 9704 and Proclamation 9705, imposing tariffs on imports of aluminum and steel, respectively, after determining that such imports threatened to impair national security. These foundational tariffs have shaped subsequent trade policy related to these materials.
More recently, on October 17, 2025, Proclamation 10984 was issued. This proclamation found that imports of medium- and heavy-duty vehicles MHDVs, their parts MHDVPs, and buses also threatened to impair U.S. national security. Consequently, it imposed specified tariffs on these imports. Critically, Proclamation 10984 also acknowledged the interconnectedness of the automotive supply chain, conforming aspects of a prior tariff system for automobiles and automobile parts, established under Proclamation 10908, with the new MHDV tariffs. Furthermore, Proclamation 10984 provided a mechanism to modify the existing steel and aluminum tariffs from Proclamations 9704 and 9705.
The Tariff Adjustment Mechanism
Under Proclamation 10984, the Secretary of Commerce is authorized to reduce tariffs owed by up to half the otherwise applicable rate for aluminum or steel producers. This reduction is specifically for firms that operate production facilities in Canada or Mexico and commit to increasing their primary steel or primary aluminum production capacity in the United States. The goal is to enhance supply chain security and domestic production for U.S. MHDVs and automobiles.
For an adjusted tariff rate to apply, several conditions must be met. The reduction is limited to quantities of aluminum or steel equal to the newly committed U.S. production capacity, as determined by the Secretary. The adjusted tariff rate may be no less than 25 percent. Additionally, the imports must qualify for preferential tariff treatment under the U.S.-Mexico-Canada Agreement USMCA and must have been smelted and cast or melted and poured in Canada or Mexico.
The Secretary has clarified that only commitments to increase production of primary steel and primary aluminum are eligible. "Primary steel" is defined as any semi-finished or finished steel product first produced in a liquid state in a steel making furnace. "Primary aluminum" refers to new aluminum metal produced from alumina by the electrolytic Hall-Heroult process. This focus is intended to address key bottlenecks and increase the supply of these essential materials for downstream producers of automobiles and MHDVs. The increased capacity must support U.S. production of key products, which include automobiles, MHDVs, automobile parts, and MHDV parts, as these are critical inputs.
The Information Collection Process
The current Federal Register notice is a procedural step under the Paperwork Reduction Act of 1995. The Department of Commerce is seeking public comments on an information collection request it will submit to the Office of Management and Budget OMB for review and approval. This collection, identified by OMB Control Number 0625-0285, establishes the process for Canadian and Mexican firms to apply for the authorized tariff adjustments. The notice specifies a 30-day comment period, following an initial 60-day period earlier in the year. The Department estimates 60 respondents, with an average of 60 hours per response, totaling 3,600 burden hours.
Strategic Implications and Objectives
This program underscores the ongoing federal strategy to leverage trade policy for industrial policy goals. By linking tariff reductions to new domestic production commitments, the government aims to directly incentivize the re-shoring or near-shoring of critical manufacturing capabilities. The emphasis on primary steel and aluminum reflects a targeted approach to address fundamental weaknesses in the supply chain that could impact the broader automotive industry, a sector deemed vital for national security.
The policy also highlights the complex interplay between national security concerns and international trade agreements. While imposing tariffs, the program simultaneously seeks to deepen North American supply chain integration under USMCA by offering incentives to Canada and Mexico-based producers. This approach aims to create a more resilient and geographically proximate supply network for key automotive components, minimizing reliance on potentially vulnerable distant sources.
