Concerns are escalating within the American industrial sector following U.S. President Donald Trump’s announcement of impending tariffs on steel and aluminum imports.

The administration revealed plans to impose a 25% tariff, effective March 12, 2018, as part of a broader protectionist trade policy.

This move has prompted executives across various industries, from manufacturing to oil and gas, to explore strategies to mitigate potential cost increases of essential metal raw materials.

Jim Farley, CEO of Ford, addressed the issue during an automotive conference, stating, "What we’re seeing so far is a lot of costs and a lot of confusion," as he prepared to meet policymakers in Washington for the second time in three weeks.

He emphasized the political uncertainty surrounding the situation while stressing the need for professional management.

The decision to bolster inventories of crucial production materials comes after the White House announced metal tariffs, initiating widespread concern among American businesses.

The U.S. is a net importer of steel and aluminum, indicating that the tariffs could lead to increased prices in domestic markets.

Recent reports indicate a surge in additional costs faced by manufacturers in the Midwest compared to benchmark prices in London.

Data from the LME (London Metal Exchange) indicates that aluminum futures prices in the Midwest have surged by 25% since the end of January.

These contracts highlight the price disparity between aluminum in London and the Midwest, taking into account additional costs such as transportation and taxes.

In the steel market, the impact of the tariffs extends even to companies that do not directly import steel, as domestic mills begin to raise prices in response to the new guidelines.

Ray Drozdenko, pricing director for steel in the Americas at Argus Media, reported that prices had already started to climb in the three weeks following Trump’s tariff threats directed at Canada and Mexico, both significant steel suppliers to the U.S. market.

Drozdenko noted an increase in hot-rolled coil prices—an essential product serving as a steel price benchmark—of $70, bringing it to $850 a ton since late January.

Coca-Cola confirmed that aluminum and steel comprise over 25% of the packaging materials utilized in its global products.

CEO James Quincey warned that tariffs on aluminum imports might compel the company to increase its reliance on plastic packaging.

However, he reassured investors about the limited impact of these tariffs on overall projected sales for 2025, stating, "It’s an added cost that it would be nice to avoid, but we will figure it out."

Meanwhile, trade associations and analysts within the energy sector cautioned that Trump’s tariff plans contradict his stated goals of increasing domestic energy production, reducing consumer prices, and supporting the local industry.

This is primarily due to the sector's heavy reliance on steel and aluminum at various production stages, from oil and gas drilling to pipeline construction and manufacturing of clean energy components such as wind turbines and solar panel mounts.

Dustin Meyer, Senior Vice President for Policy and Economics at the American Petroleum Institute, remarked that the development of the U.S. energy sector requires access to raw materials that are insufficiently available in the domestic market.

He indicated the sector's willingness to collaborate with the Trump administration to find solutions that avoid unintended negative consequences.

A report from Wood Mackenzie highlighted that imports satisfy 40% of the U.S. market’s needs for pipe and rolled metal products, essential materials used in drilling operations.

It noted that Canada and Mexico accounted for 16% of these imports during the previous month.

Nathan Nemeth, an analyst at the firm, warned that extending tariffs to other countries beyond Canada and Mexico could trigger a new wave of cost inflation.

David Gettleman, CEO of Carrier Global, a provider of heating and cooling systems based in Florida, expressed confidence in his company's ability to alleviate the impact of steel and aluminum tariffs.

He mentioned that the company has already procured the necessary steel for its North America operations for the current year.

Gettleman acknowledged that Carrier had faced significant criticism from Trump during his first term due to plans to shift some jobs to Mexico, asserting that comprehensive tariffs on Mexican goods would have a larger effect compared to the current metals tariffs.

Gettleman revealed that the company is exploring several options to adapt to the situation, including price adjustments and strengthening supplier relationships to enhance domestic production.

"We have experience dealing with tariffs, and we’re focusing on increasing production within our U.S. facilities," he stated.

Executives at LCI Industries, an Indiana-based manufacturer of vehicle structures and recreational vehicle components, expressed concern over the dual impact of the new tariffs.

In addition to the metals tariffs, the company is facing a 10% additional tariff on Chinese goods announced last week, which could adversely affect their profit margins.

While the company intends to mitigate this impact through cost distribution between suppliers and customers, officials acknowledged the challenges of planning amidst prevailing uncertainty.

CFO Lilian Itzkorn stated, "Unfortunately, things change daily.

I find myself having to read the news every morning to keep up with developments.

We may face changes we didn’t expect in the tariff landscape at this point."