EU goods exports to the US plunge after new tariff agreement

By Al Mayadeen English
Source: Wall Street Journal + Agencies
Today 15:39

EU goods exports to the US fell 26% in August 2025 after a new 15% tariff agreement, cutting the trade surplus and prompting EU calls to lift steel and aluminum tariffs.

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The OOCL Rotterdam container ship is moored at the Long Beach Container Terminal in the Port of Long Beach, California, on April 8, 2025. (AP)

European Union (EU) goods exports to the United States experienced a significant downturn in August 2025, following the signing of a new tariff agreement between the two economic blocs. According to Eurostat data released on Thursday, exports fell by 26% compared to July, totaling €32.9 billion (approximately $38.3 billion).

This decline marks the lowest monthly export figure since August 2021. Year-over-year, exports decreased by 22%, reducing the EU’s trade surplus with the US to €6.5 billion from €15.3 billion in August 2024.

Tariff agreement details

The sharp decline in exports follows the agreement reached in late July 2025 between the EU and the US to implement a 15% baseline tariff on most goods imported into the US.

This agreement, known as the Framework Agreement on Reciprocal, Fair, and Balanced Trade, was finalized on August 21, 2025. Under the terms of the agreement, the US committed to applying the higher of either the US Most Favored Nation (MFN) tariff rate or a 15% tariff on originating goods from the EU.

Certain products, such as steel, aluminum, and copper, are subject to higher tariff rates, while others, including natural resources unavailable in the US, aircraft and aircraft parts, and generic pharmaceuticals, are exempt from the new tariffs.

Impact on EU exports

Agricultural machinery manufacturers, such as Krone, have halted exports to the US due to stringent steel derivative tariffs introduced by the Trump administration. These tariffs require exporters to provide highly detailed documentation on the origin, weight, and value of all steel components, making compliance nearly impossible for some companies.

However, tariffs on European-made cars saw a substantial decrease, as the deal secured a 15% levy to replace the previous 27.5% tariff.

In response to the downturn in exports, the European Commission is urging the United States to eliminate tariffs on products made from steel and aluminum, as part of efforts to implement the full scope of the joint EU-US tariff agreement.

EU Trade Commissioner Maros Sefcovic emphasized that both parties have a shared interest in protecting their domestic steel markets from overcapacity. Under current terms, 50% US tariffs could be replaced with tariff-free or low-tariff quotas. The EU proposed to increase its steel tariffs to 50%, reduce quotas by half, and clarify steel origins to match US protective measures, according to Reuters.