According to Trump, the pharmaceutical tariffs will begin at a modest level, giving manufacturers up to 18 months to relocate production to U. S. soil, before escalating to “a very, very high rate, like 200 percent”. He also indicated that semiconductor tariffs were on a similar timeline, noting chip levies would be “less complicated” to enact.
These sectoral tariffs follow a 50 % duty on copper imports, scheduled for implementation on or before 1 August after a Section 232 investigation earlier in the year. Copper futures have already surged, with U. S. Comex prices hitting record highs following Trump’s announcement.
Administration officials have dispatched letters to over 14 trading partners detailing planned reciprocal tariffs ranging from 25 % to 40 %, with additional communications expected to cover all remaining nations. Baseline reciprocal tariffs are set at 10 %, with country-specific rates applied via executive orders that remain temporarily paused or legally challenged.
Challenges to the legality of broad tariffs have emerged in U. S. courts. A federal appeals court has temporarily stayed rulings that had previously struck down the tariffs on grounds of presidential overreach under IEEPA. Oral arguments in the Federal Circuit are scheduled for 31 July.
Economic analysts warn of inflationary implications. Copper is foundational to power grids, electric vehicles, and telecommunications infrastructure, and a 50 % tariff threatens soaring industrial costs. Doubts have arisen about the U. S.’s capacity to rapidly expand domestic copper refining, raising concerns about supply bottlenecks and downstream inflation.
The pharmaceutical industry, which includes major players such as Eli Lilly, Merck and Pfizer, warns that extreme tariffs could drive up drug prices, hinder further investment and disrupt global supply chains. Hospitals and pharmacies rely on overseas production for active pharmaceutical ingredients, making them particularly vulnerable.
Semiconductor tariffs, although less defined, could widely affect global technology firms. Components for smartphones, laptops, and automotive electronics—products manufactured by companies like Apple and Samsung—could face new import duties.
Amid these threats, the administration has maintained that trade negotiations remain in motion. A revised agreement with Indonesia reportedly reduced an initially proposed 32 % tariff to 19 %, in exchange for $15 bn in energy purchases, $4.5 bn in agricultural goods, and the sale of 50 Boeing jets. Trump also noted ongoing discussions with India, other nations in Asia, the European Union, and South Korea ahead of the 1 August deadline.
European leaders have responded by engaging with U. S. negotiators to avert proposed duties that could reach 30 %. UK aerospace goods have reportedly secured a temporary exemption under WTO civil aircraft agreements.
Critics argue that the reciprocal tariff formula is oversimplified and disproportionate to actual trade barriers imposed by partner nations. Many economists view the tariffs as politically motivated, aimed more at stimulating domestic production than addressing any genuine national-security crisis.
Markets have shown limited volatility amid the tariff tension: U. S. equity indexes dipped mildly, while copper futures jumped over 12 %, into record territory. Import duty revenue reached approximately $27 bn in June, buoyed by elevated tariff levels.
With the 1 August implementation date looming and legal disputes still unfolding, domestic and global manufacturers face a unique crossroad. They must weigh the cost of shifting supply chains to the U. S. against escalating duties against a backdrop of disruptive trade policy. Such shifts may reshape manufacturing patterns, supply chain logistics, and geopolitical alliances in sectors central to national security, public health, and economic infrastructure.