What Are the U.S. Import Tariffs on Custom Steel Parts from Vietnam?

The trade relationship between Vietnam and the U.S. has been heavily influenced by tariffs on custom steel parts. With ongoing shifts in trade policies, understanding the current tariff situation is crucial for businesses importing steel parts from Vietnam. Below, I will guide you through the key details on U.S. import tariffs, including how they impact costs and the potential benefits of trade agreements.

As of April 2025, custom steel parts from Vietnam face a cumulative tariff burden of 71%, combining a 25% tariff under Section 232 and a 46% reciprocal tariff.

In April 2025, the US increased its import tariffs on Vietnam by 46% from 25% to 71%, but then the Trump administration changed its tone and delayed the increase in tariffs until July 1, 2025. The Vietnamese government is actively negotiating with the US government, attempting to open up more industries to US companies in exchange for a reduction in US import tariffs on Vietnam to around 10%.

If the US-China tariff war ends in mid-2025, the US tariff on China will most likely only be reduced to around 20% + 34% = 54%. If the US imposes a 10%-25% import tariff on Vietnam, this means that Vietnam will have a comparative advantage over China in terms of tariffs on the US. Even though the unit price of Vietnamese products is generally around 30%-50% more expensive than that of China, considering the tariff difference, the landed price of Vietnamese products exported to the US will be cheaper than that of Chinese products.

This significant tariff increase presents challenges but also highlights the importance of understanding and navigating these costs effectively.

U.S. Tariff Policy for Vietnamese Steel Products

The U.S. imposes a 25% tariff on most steel imports from Vietnam, including custom steel parts, under Section 232 of the Trade Expansion Act. This policy, which was originally enacted in 2018, aims to protect U.S. national security by limiting the volume of foreign steel entering the U.S. market, which could potentially harm domestic steel industries.

Key Aspects of Section 232 Tariffs:

1. 25% Tariff on Custom Steel Parts:
   Custom steel products from Vietnam, including fabricated and machined steel parts, are subject to this 25% tariff unless specific exemptions apply.

2. National Security Focus:
   The tariff was primarily designed to safeguard the U.S. steel industry from unfair foreign competition, particularly from countries that heavily subsidize their steel industries.

3. Application to a Broad Range of Steel Products:
   This tariff applies broadly to many types of steel products from Vietnam, including custom fabricated and precision-machined components, regardless of their level of complexity.

Reciprocal Tariffs and Their Impact

In addition to the Section 232 tariffs, the U.S. has imposed a 46% reciprocal tariff on Vietnamese imports, which will take effect on July 1, 2025.

Details of the 46% Reciprocal Tariff:

1. High Additional Duty:
   This new reciprocal tariff was announced in April 2025, citing the U.S. trade imbalance with Vietnam. The 46% duty is added to the 25% Section 232 tariff, resulting in a total of 71% tariffs on steel products from Vietnam.

2. Multiplier Effect on Tariffs:
   The total tariff burden on Vietnamese steel parts, including custom components, will reach 71%. This additional surcharge severely impacts the price competitiveness of Vietnamese exports to the U.S., especially compared to other countries with lower or no reciprocal tariffs.

3. Increased Costs for Exporters:
   The total duty of 71% means that Vietnamese suppliers will face a significant disadvantage when competing with other countries like Mexico or South Korea, where tariffs are lower.

How Tariffs Affect the Total Cost of Products

Tariffs significantly increase the total cost of custom steel parts imported from Vietnam, which impacts pricing strategies for U.S. importers.

Key Points to Consider:

1. Increased Import Costs:
   The 25% tariff under Section 232 and the new 46% reciprocal tariff mean that a custom steel part with a base value of $100 would incur an additional $71 in tariffs. This can make Vietnamese steel parts much more expensive than alternatives from countries with lower tariffs.

2. Impact on Price Competitiveness:
   Suppliers in Vietnam are at a disadvantage compared to countries like Mexico and South Korea, where the combined tariffs are lower, especially for high-value custom parts used in industries like automotive and machinery.

3. Pass-Through of Costs:
   Importers will likely need to pass these additional costs onto U.S. consumers or explore cost-saving measures such as sourcing from countries with lower tariff rates.

4. Cost Planning and Pricing Adjustments:
   For U.S. businesses importing custom steel parts from Vietnam, it is critical to factor these tariffs into the overall cost structure and adjust pricing accordingly to maintain profitability.

How to Check the Exact Tariff Rates for Specific Products

To check the exact tariff rates for specific steel products from Vietnam, businesses should reference the U.S. Harmonized Tariff Schedule (HTS).

Steps to Find Specific Tariff Rates:

1. Consult the HTS Database:
   The HTS database provides detailed information on tariffs for different product categories. By searching for your specific steel parts or components, you can identify the applicable tariff rates.

2. Use the U.S. Customs and Border Protection (CBP) Resources:
   CBP offers online tools for businesses to check tariff rates and classifications based on product descriptions and HS codes.

3. Work with a Customs Broker:
   Engaging with a licensed customs broker can help ensure that the correct tariff codes are applied to your products, minimizing the risk of overpaying or facing customs issues.

Exemptions and Mitigation Strategies

Certain products may qualify for exemptions, and businesses can explore various strategies to mitigate the impact of tariffs.

1. Tariff Exclusions:
   Companies may apply for tariff exclusions if the product does not have an adequate domestic alternative or if the product is essential for the business. However, approval for these exclusions is not guaranteed.

2. Negotiations and Diplomatic Efforts:
   Vietnam is actively negotiating with the U.S. government to reduce tariffs, potentially lowering the duty to 10% under specific conditions. Keeping track of these negotiations is essential for future cost planning.

3. Sourcing from Alternative Markets:
   Importers may also consider diversifying their supply chains by sourcing from other countries with more favorable tariff conditions, such as Mexico, Canada, or South Korea.

Conclusion

The U.S. tariff policy on custom steel parts from Vietnam, especially the combination of Section 232 and the new 46% reciprocal tariff, creates a significant cost burden for U.S. importers. Businesses need to carefully monitor these tariffs, check exact rates using the HTS, and explore possible strategies to mitigate the impact, including sourcing from countries with lower tariffs or applying for tariff exclusions.

Summary Table of Key Tariff Information

By staying informed and actively managing tariff-related issues, businesses can navigate the complexities of U.S. import tariffs on Vietnamese custom steel parts.

Footnotes