WHAT’S THE LATEST

On June 1, 2026, a Presidential Proclamation was issued modifying the Section 232 tariff framework for certain aluminum, steel, and copper derivative products. The changes take effect June 8, 2026, and apply on a temporary basis through December 31, 2027.

The proclamation expands eligibility for the reduced 15% Section 232 rate to additional equipment categories, introduces a lower U.S.-content threshold for the 10% incentive rate, and adds new products to derivative tariff coverage. The relief is intended to lower near‑term input costs for specific industrial and manufacturing sectors while maintaining baseline Section 232 protections.

WHAT WE KNOW

Affected Product Categories

Effective June 8, 2026, the following HTS‑classified products are subject to modified Section 232 derivative tariff treatment:

Agricultural Equipment (Annex I-C & Annex III) moved to 15%

Agricultural equipment predominantly composed of aluminum or steel is now included in the fixed industrial machinery category subject to the temporarily-reduced 15% rate.

  • Was: 25% under Section 232 
  • Examples: Combines, harvesters, tractors, planters, crop processing equipment.
Residential HVAC Systems & Components (Annex III) moved to 15%

Certain HVAC systems and components predominately for residential use that are aluminum or steel derivative products now qualify for the 15% reduced rate.

  • Was: 25% under Section 232 
  • Examples: Residential air handlers, condensing units, heat pumps, ductwork components
Mobile Industrial Equipment & Machinery (Annex I-C): 15% (Trade Deal Countries)

Mobile industrial equipment and machinery are temporarily added to the 15% rate tier — but only when imported from trade deal countries listed in clause (2)(b).

  • Was: 25% under Section 232  
  • Examples: Bulldozers, forklifts, excavators, cranes, material-handling equipment

Rate Structure for Annex I-C Products

For aluminum and steel articles listed in Annex I‑C, the following Section 232 rate tiers apply from June 8, 2026 through December 31, 2027:

Base Rate (All Other Countries): 25%

Applies to all Annex I-C aluminum and steel articles not eligible for a lower rate. Unless clause (b), (c), or (d) applies.

Trade Deal Countries: 15% Cap

Argentina, Ecuador, El Salvador, Guatemala, Japan, South Korea, Liechtenstein, Switzerland, Taiwan, UK, EU member nations. 

  • If Column 1 rate < 15%: Section 232 fills gap to 15% total.
  • If Column 1 rate >= 15%: no additional Section 232 duty.
U.S. Content Incentive: 10%

Applies if products aluminum was smelted & cast in the U.S., or steel was melted & poured in the U.S.

Threshold: at least 85% of the weight of aluminum, steel, or copper content must be U.S.-origin. Lowered from prior 95% threshold.

Canada & Mexico (USMCA): 25% on non-U.S.

Duty of 25% applies only to the non-U.S. content of the product. Minimum effective duty: 15% ad valorem regardless of U.S. content share. 

CBP guidance on U.S. content assessment forthcoming.

Additional Key Details

  • New derivative products added: Aluminum lithographic plates and steel racks are now subject to Section 232 derivative tariffs for the first time.
  • USMCA guidance pending: CBP will issue methodology guidance for assessing U.S. content. Misrepresentation may result in penalties.

Sunset Planning Required: Rates Revert January 1, 2028

All reduced rates under this proclamation are temporary and expire December 31, 2027. Beginning January 1, 2028, Section 232 duties revert to Proclamation 11021 levels. Importers should account for the 18‑month duration in sourcing strategies, capital equipment purchases, and contract pricing.

SEKO'S GUIDANCE

SEKO recommends that importers take the following actions:

  • Identify affected classifications: Review imports of agricultural equipment, residential HVAC systems, mobile industrial machinery, aluminum lithographic plates, and steel racks. Confirm correct HTS classification and review Annex I‑C and applicable Chapter 99 subheadings.
  • Verify country‑of‑origin eligibility: For mobile industrial equipment, the 15% rate applies only to imports from trade‑deal countries. Confirm origin documentation, particularly for machinery with multi‑country assembly.
  • Evaluate U.S.‑content eligibility for the 10% rate: The revised 85% U.S. metal threshold expands eligibility. Work with suppliers to assess qualification and ensure documentation supports U.S.‑content claims.
  • Update procurement pricing for HVAC and agricultural equipment: The reduction from 25% to 15% represents a material landed‑cost change effective June 8. Update cost models and bookings accordingly.
  • Assess exposure for newly covered products: Importers of aluminum lithographic plates and steel racks should prepare for new Section 232 duty exposure. Review open purchase orders and in‑transit shipments.
  • Plan for the December 31, 2027 sunset: These reductions are temporary. Sourcing, pricing, and capital equipment decisions should account for the January 1, 2028 rate reset.
  • Monitor CBP guidance on USMCA U.S. content: Await CBP methodology before claiming U.S.‑content deductions on Canada‑ and Mexico‑origin goods. Prepare supplier certifications in advance.

Our trade compliance team is monitoring the full Annex I-C product list and HTSUS modifications.  If you have questions, please reach out to your SEKO representative, or email us at hello@sekologistics.com.