19 January 2026 – Despite renewed tariff announcements from the United States directed at Europe, prices for stainless steel and base metals such as nickel, aluminium, and copper have remained relatively unaffected in Asian trading. An analysis published by Deutsche Bank on 19 January 2026 on the price effects of new trade tariffs makes one point clear: tariffs primarily act as price drivers – also within the EU.
Stainless Steel Raw Materials Start the Week on a Stable Footing
Despite renewed tariff announcements from the United States aimed at Europe, prices for base metals such as nickel, aluminium, and copper showed little reaction in Asian trading. European base metals posted gains at the start of trading.
Nickel Prices Remain at Stable Levels
SHFE nickel futures opened Monday’s session slightly lower but recovered during the course of the trading day, ultimately trending largely sideways. Spot market prices for stainless steel in China remained stable.
LME nickel prices opened European trading on a positive note, with gains of up to 1.3%, while prices continue to hover close to the USD 18,000 per tonne mark.
After nickel prices have risen steadily over recent weeks, February alloy surcharges for EU stainless steel producers for grade 304 are therefore likely to increase by more than 10% month-on-month – provided that no last-minute changes are made to the calculation methodology.
Aluminium maintains its high level
Aluminium prices continue to trade at elevated levels and stood at USD 3,138.5 on Friday, nearly 9% higher than one month earlier. US aluminium premiums for spot material have also rebounded quickly after a brief dip in early January and are currently holding steady at their most recent record highs of around USD 2,164 per metric tonne, or USD 0.98 per pound.
European Tariff Policy as a Risk to Prices and Competitiveness
An analysis published by Deutsche Bank on 19 January 2026 on the price impact of new trade tariffs highlights a key conclusion: tariffs primarily function as price drivers. This insight is not only relevant for current US trade policy, but also for tariff decisions within the EU itself.
While recent tariff announcements by Donald Trump targeting certain EU Member States in connection with Greenland have once again drawn attention, the underlying economic mechanisms apply almost symmetrically to Europe. Empirical research (among others by Mary Amiti, Stephen J. Redding, and David E. Weinstein) shows that tariffs are not absorbed by suppliers, but are largely passed through into higher import, producer, and consumer prices. This is precisely the relationship emphasised in the Deutsche Bank analysis.
Risk: European Tariffs Hit the European Economy
Applying this logic to the EU highlights the risk: raising European tariffs on intermediate goods, such as steel, from 0% to 50% would not primarily affect foreign suppliers, but would significantly increase production costs for European industry.
Steel is a key input for the automotive sector, mechanical engineering, construction, and numerous other industries. Rising steel prices would therefore ripple broadly through value chains.
Several major European manufacturing associations highlighted this risk in a letter to the Commission in early January 2026, explicitly warning against the introduction of such tariffs.
Higher Input Costs Make European Products More Expensive, Less Competitive
For the EU’s export-oriented economy, this creates a structural challenge. Higher input costs either make European products more expensive on global markets or force companies to sacrifice margins in order to remain competitive. Both outcomes weaken investment capacity and innovative strength, while competitors in regions with lower material costs gain market share.
While US tariffs spread their costs broadly across consumers, a tightening of European tariffs would concentrate the burden on domestic industry. At a time of high energy prices and fragile economic conditions, such a policy would further fuel price pressures and place Europe’s international competitiveness under severe strain.
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