Keeping up with the current tariffs - by Kerrick Wille
As we come closer to the end of the summer, the tariff craze has only seemed to become more and more unpredictable. It seems like there are new announcements and suspensions extended every day. Because of this, it can be hard to stay on top of what the most current tariffs implemented are. This article will break down the most up-to-date tariffs that those in the real estate industry would want to be aware of.
What does the current tariff environment look like?
China 30% (to be 145% on November 10)
On August 11th the U.S. pushed the Suspension on China tariffs back 90 days, now set to expire on November 10th. When the suspension expires the China tariffs will move from the current 30% to 145%. This extension now marks the second time that the U.S. has placed a 90-day suspension on China, with the first coming in May of this year. This raises questions as to how these tariffs will play out in the future, but barring any drastic changes, they will lock at 30% until November 10th.
Canada 35%
The U.S. currently has a 35% tariff on Canadian goods, with the exception of USMCA-compliant goods. This 35% comes from a 10% increase that was implemented in August. Even though USMCA-compliant goods make up many of the materials that are important for construction in America, the 35% tariff has still increased prices across the board.
Mexico 25%
Mexico was supposed to have their tariffs increased to 30% in August, but instead had their current tariffs extended another 90 days. This keeps Mexico at 25% for the next few months. As stated before, USMCA-compliant goods are generally exempt from tariffs, which includes many of our imports from Mexico. Although there was no increase in the tariffs, the 25% tariff has still been felt throughout the industry.
EU 15%
The U.S. currently has a 15% tariff implemented on the EU. The EU previously had a 10% tariff that was set to increase to 30% on August 1st, but a late July agreement set the tariff at a less extreme rate of 15%.
Copper, Steel, and Aluminum 50%
There has been a 50% tariff implemented on copper, steel, and aluminum. The 50% tariff on steel and aluminum was implemented in the beginning of June and the 50% tariff on copper was implemented in August. It has not been enough time to fully feel the effects on prices of copper, but it is likely that the tariff will be felt significantly in pricing for pipes, wires, and HVAC components.
What has the construction material impact been so far?
So far, extreme price increases have not been seen in the construction industry. There have been some increases of course, but certainly not a full pass along from the tariff amount. The industry seems to stay in a “wait and see” mode likely due to the changing tariffs and extended deadlines and the fact that nothing seems to be set in stone. Pay close attention to the big tariffs of course when budgeting a job and remember that many U.S. produced goods rely heavily on tariffed international materials. For example, as much as four million metric tons out of 6.75 million metric tons of imported aluminum went into U.S. production in 2024.
Conclusion
Risk and uncertainty remain high, but calmer heads seem to have prevailed in not panicking for costing construction projects. It will be an interesting next few months, particularly regarding China, but if the 10% to 15% tariff is the landing spot for countries, the impact should not be as devastating as first feared.
Kerrick Wille is a building consultant at KOW Building Consultants, Manhattan, N.Y.