US, Japan reach deal to cut tariffs on Japanese steel

The United States and Japan on Monday announced a deal to remove Trump-era tariffs from about 1.25 million metric tons of Japanese steel imports annually after Washington granted similar access for European Union steelmakers last year.

The new deal, which excludes aluminum, will take effect on April 1 and requires Japan to take  "concrete steps" to fight global excess steel manufacturing capacity, largely centered in China, US officials said.

A joint US-Japan statement said Japan would start to implement within six months  "appropriate domestic measures, such as antidumping, countervailing duty, and safeguard measures or other measures of at least equivalent effect," to establish more market-oriented conditions for steel.

The agreement, like the EU steel and aluminum deal reached in October, calls for steel imported from Japan to be completely produced in the country for duty-free access, a standard known as  "melted and poured," to reduce the risk of Chinese steel skirting US tariffs.

"This is a step towards a solution... but we will continue to strongly urge the United States to fully eliminate the tariff in a manner consistent with WTO rules," Japanese industry minister, Koichi Hagiuda, said on Tuesday.

An official at the ministry said the exclusion of aluminum reflected the US position and was not a request by Japan.

Much of the Biden administration's trade efforts have centered around patching up strained relations with US allies that are market-driven democracies.