Two Major Tariff Actions Signed April 2: What Importers Need to Know Before April 6
On April 2, 2026, the Trump administration signed two separate tariff actions. One is a proclamation restructuring Section 232 tariffs on steel, aluminum, and copper. The other is an executive order imposing new Section 232 tariffs on patented pharmaceutical imports. Both are significant. The metals changes took effect at 12:01 a.m. on April 6, with no exceptions for goods already on the water. The pharmaceutical tariffs have longer runways but are already creating planning decisions for importers.
This post covers both actions in detail, including the new valuation methodology for metals, the five-tier rate structure, the pharmaceutical rate tiers and exemptions, and what each change means in practice.
Metals: the valuation shift is the story
The headline rate on pure steel, aluminum, and copper articles stays at 50%. That number is not new. What is new is how the tariff is calculated. Under the old methodology, tariffs on derivative articles applied to the declared metal content value within the product. That created a compliance burden and, according to the White House, allowed tariffs to be assessed against artificially low declared values. Under the April 2 proclamation, the tariff now applies to the full customs value of covered products, regardless of metal content percentage.
For importers of commodity metals, this changes little. Steel coils and aluminum sheet were already paying the full value. For importers of derivative articles, this is a material change. A product that was previously assessed only on the cost of its steel or aluminum component now faces a tariff on its entire entered value, at the applicable rate for its category. That means the landed cost math for derivative importers needs to be redone from scratch against the new structure.
The five-tier rate structure
The proclamation establishes five distinct rate categories, all applied to the full customs value. Articles made entirely or almost entirely of steel, aluminum, or copper, such as steel coils, aluminum sheet, and most copper products, pay 50%. Derivative articles substantially made of those metals pay 25%. Certain metal-intensive industrial equipment and electrical grid equipment pay 15% through December 31, 2027, a temporary reduction intended to support domestic infrastructure buildout without adding cost pressure to grid expansion projects. Products made abroad but manufactured entirely from U.S.-smelted or U.S.-poured metals pay 10%. And products where the metal content is 15% or less of the article are no longer subject to Section 232 tariffs at all.
The UK continues to receive reduced rates under its existing trade arrangement. Products of EU, Japanese, South Korean, and other trade agreement partner origins may also qualify for modified treatment depending on the metal content sourcing. Russian-origin aluminum remains at 200% and is unchanged by this proclamation.
One structural change worth noting: the Section 232 inclusions process, through which domestic producers could petition for additional derivative products to be brought under the tariffs, has been terminated. Going forward, the Department of Commerce and the U.S. Trade Representative can add derivative articles jointly when they determine that imports threaten national security, but the open petition window is closed.
Foreign trade zones, drawback, and on-the-water goods
There is no on-the-water exception. Goods entered for consumption or withdrawn from the warehouse on or after 12:01 a.m. April 6 is subject to the new rates. Goods that were already in transit when the proclamation was signed are not exempt.
Products admitted to a U.S. foreign trade zone on or after April 6 must enter under privileged foreign status. Products already admitted under privileged foreign status before the effective date will be subject to the applicable rates when entered for consumption.
Manufacturing drawback is available for Annex I-B and Annex III articles that are products of trade agreement partners, provided the metal content was smelted or cast in a trade agreement partner country, and the article is not subject to antidumping or countervailing duty orders. No other forms of drawback apply.
Pharmaceuticals: a 100% tariff with a long list of exceptions
The pharmaceutical executive order is more complicated than the headline number suggests. The baseline tariff is 100% on patented pharmaceutical products and active pharmaceutical ingredients, applied under Section 232 on national security grounds. The justification cited in the order is that approximately 53% of patented pharmaceutical products and 85% of active pharmaceutical ingredients by volume are currently produced outside the United States, creating supply chain vulnerabilities that the administration has classified as a national security concern.
But 100% is not the rate most companies will actually pay, at least not initially. The structure is heavily tiered based on company behaviour and country of origin. Companies that sign both an onshoring agreement with the Department of Commerce and a Most Favoured Nation pricing agreement with the Department of Health and Human Services pay 0% through January 20, 2029. Companies that only sign an onshoring agreement pay 20%. Companies from the EU, Japan, South Korea, Switzerland and Liechtenstein face 15%. The UK faces a lower rate under a separate bilateral agreement concluded earlier this year. Companies listed in Annex II, which have already entered into company-specific tariff agreements with the administration, pay 0%.
Effective dates are staggered. Large pharmaceutical companies identified in Annex III face the tariffs starting July 31, 2026, 120 days from the proclamation date. All other companies and importers face the tariffs from September 29, 2026, 180 days out.
Several product categories are fully exempt, at least for now. Generic pharmaceuticals and biosimilar products are not subject to the tariffs, though the Secretary of Commerce will review that exemption in one year. Specialty categories, including orphan drugs, nuclear medicines, cell and gene therapies, fertility treatments, plasma-derived therapies, antibody drug conjugates, medical countermeasures, and veterinary drugs, are also exempt if sourced from a country with a recognized trade deal or where an urgent public health need applies. Annex IV contains the current list of patented pharmaceutical products and ingredients subject to a 0% rate, and that list can be updated over time.
The reaction from industry has been split. Pharmaceutical manufacturers with existing U.S. production or active onshoring discussions are in a better position than those without. The U.S. Chamber of Commerce called the tariff scheme complex and warned it would raise healthcare costs. Some steel industry groups, by contrast, praised the metals proclamation for what they described as right-sizing the derivative product framework and fixing the valuation methodology.
What to do now
For metals importers, the first task is mapping your product catalogue against the five-tier structure and determining which annex each product falls under. The 15% or less metal content exemption will remove some products from Section 232 exposure entirely, but that determination requires documentation. The full-value methodology means that products which previously had modest Section 232 exposure because of low metal content values may now face substantially higher duty on the same full entered value.
For pharmaceutical importers, the 120 and 180 day runways are not as long as they sound when you factor in the negotiation timelines for onshoring and MFN agreements. Companies that want to qualify for the 0% or 20% rates need to start those conversations with Commerce and HHS now. Companies sourcing from the EU, Japan, Korea, or Switzerland should confirm the 15% rate applies to their specific products and verify that their sourcing country qualifies under the relevant provisions.
Our customs brokerage team is working through both proclamations and is available to help clients assess the impact on their specific HTS codes, sourcing, and landed cost models. Reach out to your ShipTech account manager directly.