If you import steel, aluminum, or copper — or products that contain them — the rules changed on April 6, 2026. A new presidential proclamation restructured Section 232 tariffs in ways that go beyond rate adjustments. For many importers, the way duties are calculated has fundamentally shifted. And for a specific category of goods, Annex III creates a narrow window of relief that’s worth understanding now — before it closes at the end of 2027.
Here’s what you need to know.
The Biggest Structural Change: Full Customs Value
Under the previous framework, Section 232 duties on many derivative articles were assessed only on the value of the metal content within a product. That’s no longer the case.
Effective April 6, 2026, Section 232 tariffs apply to the full customs value of covered products, regardless of metal content. If you were importing a machine or piece of industrial equipment that contained some steel, you were previously paying duties on the steel portion of its value. Now you’re paying on the whole thing.
For companies that built their landed cost models around metal-content-based duty calculations, this is a meaningful shift — and one that requires an immediate review of your duty exposure across your product portfolio.
The Rate Structure, Simplified
The proclamation establishes several rate tiers based on what the product is and where its metal originated:
- 50% — Aluminum, steel, and copper articles listed in Annex I-A (e.g., steel coils, aluminum sheet)
- 25% — Derivative articles listed in Annex I-B
- 15% (transitional) — Certain industrial and electrical grid equipment listed in Annex III, through December 31, 2027
- 10% — Derivative articles made entirely with U.S.-origin metal
- 0% — Products composed of 15% or less steel, aluminum, or copper by weight are no longer subject to Section 232 metals tariffs, provided they fall outside Chapters 72, 73, 74, and 76 of the HTSUS
What Annex III Actually Does — and Why It Matters
Annex III is the provision most relevant to importers of metal-intensive industrial equipment. From April 6, 2026 through December 31, 2027, products listed in Annex III receive a temporary rate reduction: for goods with a Column 1 duty rate below 15%, the combined Column 1 rate plus the Section 232 duty will total 15%. For goods already carrying a Column 1 duty rate of 15% or higher, no additional Section 232 duty applies.
In plain terms: Annex III gives qualifying industrial equipment a temporary ceiling on total duty exposure, capped at 15%. The White House described this as designed to support the ongoing industrial base buildout currently underway across the United States.
The catch: effective January 1, 2028, goods in Annex III will be subject to the higher duty rates applicable to Annex I-B — meaning the 25% rate kicks in. If you’re importing capital equipment that falls under Annex III, you have a defined window to plan around.
FTZ Strategy: The Rules Changed Here Too
If you’re using — or considering — a Foreign Trade Zone as part of your duty mitigation strategy, the April 6 proclamation comes with a critical FTZ update that cannot be overlooked.
Products subject to this proclamation that are admitted into a U.S. Foreign Trade Zone on or after the effective date may be admitted only under “privileged foreign status.” Any products admitted under privileged foreign status prior to the effective date will be subject upon entry for consumption to applicable ad valorem duties based on their HTS classification.
This is significant. Privileged foreign status means the duty rate is locked at the time of admission — not at the time the goods eventually enter U.S. commerce. For goods admitted after April 6, 2026, that means today’s higher rates apply, even if tariff policy changes by the time you pull the merchandise out of the zone. The calculus on FTZ strategy is more complex now, and it deserves a close look with someone who understands both the regulatory landscape and your specific cargo.
What to Do Right Now
The proclamation moved fast — there is no on-the-water exception. The effective date is 12:01 a.m. on April 6, 2026. Goods already in transit are subject to the new rules upon entry.
A few immediate action items worth discussing with your logistics partner and customs counsel:
Audit your HTS classifications. Annex placement determines your rate tier. Confirm where your products land across the new annexes — particularly if you were previously relying on metal-content-based calculations or product-specific exemptions that may no longer apply.
Reassess your FTZ and bonded warehouse strategy. The change to privileged foreign status for FTZ admissions post-April 6 has real implications for how you time entries and manage duty deferral. Bonded warehouse remains a viable tool for certain strategies — but the right answer depends on your product, your timeline, and your cash flow position.
Model the Annex III window. If you’re importing qualifying industrial equipment, the transitional 15% cap is meaningful through December 31, 2027. That window has a hard end date. Plan capital equipment imports accordingly.
Document metal origin. Documentation will still matter. Although duties now apply to full entered value, origin documentation remains key to establishing whether goods qualify for the 10% U.S.-origin metal rate, the low-metal-content exclusion, or other reduced rate provisions.
The Bigger Picture
Section 232 started as a steel and aluminum tariff program. It’s now a steel, aluminum, and copper program — and with the April 2026 proclamation, it’s been significantly restructured in scope, methodology, and rate structure. The complexity is real. But so is the opportunity to minimize exposure for clients who are proactive about classification, warehousing strategy, and entry timing.
Questions about how these changes affect your supply chain? We’re here to help. Reach out to the Blue Ridge team to start the conversation.