THE NEW 25% STEEL TARIFF MAY HAVE LAID THE GOLDEN EGG for domestic steel mills, which have seized the opportunity to capitalize on the tariff-driven market shift. They are raising prices on raw carbon steel, hot-rolled steel coil, and stainless steel coils used in the production of telecom infrastructure. Steelmakers are pushing higher costs, adding further financial strain on carriers, towercos, contractors, equipment manufacturers, and distributors. Manufacturers said they are adjusting daily to the changes and are focused on educating their customers and being quick to be transparent.
Since the U.S. telecommunications industry relies heavily on steel to construct and maintain cell towers, mounts, and products for new cell site locations and upgrades, tariffs on steel and aluminum imports, reintroduced by the Trump administration yesterday, are already creating significant market turbulence, affecting everything from carrier investment decisions to supply chain stability with President Trump’s sweeping 25% tariffs on all steel and aluminum imported into the U.S., a policy aimed at leveling the playing field for U.S. manufacturing, but a move that is expected to drive up prices.
Hot-rolled steel coil futures soared to $939.05 per ton yesterday, marking a one-year high and a more than 30% increase year-to-date, as rising tariffs on steel imports added pressure to the already limited capacity of U.S. producers. President Trump’s 25% tariff on all foreign steel imports intensified competition for available materials, prompting domestic mills and furnaces to raise prices. Despite growing demand from the U.S. manufacturing sector, which heavily depends on coil production, domestic steel supplies continued to tighten, exacerbating cost challenges for industries reliant on steel such as tower and component manufacturers.
According to a major U.S. telecom manufacturer, who preferred to remain anonymous, the effects of the tariffs are already being felt at multiple levels within the industry. The executive noted that the three largest carriers—AT&T, Verizon, and T-Mobile—are susceptible to return on investment when planning network expansions and upgrades. He believes that “Rising costs from tariffs directly impact the economics of these projects, leading to greater scrutiny and potentially delaying or even canceling infrastructure builds.”
Towercos, contractors, original equipment manufacturers, and distributors will now face increased costs and uncertainty. The inability to accurately plan for pricing and the availability of materials has led to a state of paralysis among buyers. Without clear guidance from policymakers, businesses will struggle to anticipate future costs, which will stall investment decisions.
Anticipating the tariffs, Aviat Networks informed its clients last week that it would be applying a surcharge on transmission line products, both on new quotes and existing orders. It noted that it worked actively with its suppliers to minimize customer impact.
U.S. steel price surge and the competitive disadvantage
While tariffs are intended to protect American steelmakers, they also allow domestic mills to increase prices. Even U.S.-based manufacturers are facing significant cost hikes. The anonymous source noted that domestic steel producers have already raised prices on raw carbon steel and stainless-steel coils, essential for telecom infrastructure components.
As of late February, U.S. steel prices had surged to $854 per metric ton—substantially higher than the global export average of $488 per ton, according to Steel Benchmarker. This price disparity places American companies at a competitive disadvantage compared to firms sourcing steel from countries not subject to tariffs.
Additionally, the aluminum industry presents an even more significant challenge. The U.S. has only four aluminum smelters, with just two operating at full capacity. Increasing production to offset lost imports would require vast amounts of energy—enough to power a small city, according to S&P Global. This limitation makes it difficult for U.S. companies to counteract the effects of aluminum tariffs without dramatically increasing costs.
Who pays the tariffs?
According to one manufacturer, one of the most common misconceptions surrounding tariffs is that foreign exporting countries bear the cost. The burden falls squarely on U.S. importers—companies that purchase steel and aluminum to manufacture products domestically. These importers are then faced with two choices: absorb the increased costs and risk of going out of business or pass them on to customers, ultimately making products more expensive for carriers, contractors, and consumers.
“The misconception of many, including the politicians, is that the targeted exporting countries pay the tariff. This is not true. The U.S. companies pay the tariff,” said a manufacturer’s representative.
The telecom industry is not insulated from this economic strain. Higher costs for towers, mounts, installation materials, and components mean carriers scale back network expansion plans or pass increased expenses onto customers through higher service fees. This could slow the rollout of 5G infrastructure, affecting coverage and connectivity improvements nationwide.
Retaliatory tariffs and global trade disruptions
The economic ramifications of these tariffs extend beyond the U.S. steel and telecom sectors. International trading partners, including Canada and the European Union, have responded with retaliatory measures. Canada is preparing to impose nearly $21 billion in tariffs on U.S. exports, while the EU has targeted $28 billion worth of American goods, including steel, aluminum, and various consumer products.
This trade war escalation adds another layer of uncertainty for telecom companies. If tariffs continue to drive up costs while global economic conditions become more volatile, carriers may be forced to reconsider significant investments in network upgrades and new infrastructure projects.
The future of telecom in a high-tariff environment
Industry leaders remain on high alert, adjusting strategies daily to navigate the shifting landscape. A manufacturer’s representative emphasized the importance of transparency and education, noting that businesses must stay agile in response to ongoing policy changes.
While the Trump administration argues that tariffs are necessary to protect national security and American industry, the unintended consequences could ripple across multiple sectors, including telecommunications. The sector’s dependence on steel makes it particularly vulnerable, and without clear policy direction, continued price hikes and supply chain disruptions could stall innovation and growth.
Multiple manufacturers informed Wireless Estimator that they are concerned about the steep steel hike but will not comment until they can further assess the impact of the tariffs.
