Dear Customers, Colleagues, and Friends,
We are writing to provide an important update regarding Section 232 tariffs on steel, aluminum, and derivative products, based on recent guidance issued by CBP’s Base Metals Center of Excellence and Expertise (attached for your review). This is informal guidance from the CoE. However, we understand that this will become the prevailing methodology preferred by CBP.
Key Takeaways from CBP Guidance
CBP has clarified how it is currently interpreting the valuation of metal content for purposes of Section 232 duties:
- For goods that are 100% steel or aluminum, Section 232 duties are assessed on the full entered value of the product.
- This includes manufacturing, labor, fabrication, coating, and other costs, which cannot be backed out.
- For goods that contain both metal and non-metal components:
- Section 232 duty applies to the value of the metal content only
- The metal value is determined by taking the entered value minus the cost of non-metal components
- Non-metal content refers only to physical non-metal parts, not labor, processing, or overhead
- If the metal content value cannot be determined, CBP expects duty to be applied to the full entered value. CBP has emphasized that:
- There is no breaking down of chemical composition (i.e., no separating alloys)
- U.S. vs. foreign metal content cannot be split for duty purposes unless fully qualifying for exemption
- Supporting documentation must be available to substantiate any declared values
Additional Points of Clarification
- Similar valuation methodology is being applied to copper and other base metals
- Certain non-metal products (e.g., packaged goods) may still be subject to Section 232 if their container (e.g., aluminum can) is covered
- CBP continues to expect full compliance and documentation support, and has been actively issuing requests for additional information
What This Means for You
- CBP is taking a more stringent and consistent approach to metal content valuation
- Importers should ensure they have a clear and supportable methodology for determining metal value and documentation to support declared values if challenged
- In many cases, this interpretation may result in higher dutiable values than previously reported
Given the current environment, we strongly recommend reviewing your valuation approach and coordinating internally with suppliers to understand cost breakdowns.
**** It is EXTREMELY IMPORTANT to review previous Customer Advisories ( 1/13/26 & 2/4/26) linked here to review the updated tariff refund procedure. We strongly suggest immediately registering for an ACE Portal account, if you haven’t already, and following the ACH REFUND AUTHORIZATION procedure.
Sincerely, Your friends at Krenz and Hannan International