Understanding the 2026 Section 301 Tariffs on Permanent Magnets: What the Market Needs to Know

December 16, 2025

The permanent magnet industry is approaching a major regulatory shift, one that has been quietly building for years but may still be flying under the radar for many OEMs, engineers, and supply-chain teams. While the headlines have focused on the Trump Administration’s 2025 “Executive Tariffs,” another set of tariffs, the long-planned Section 301 increases, will activate January 1, 2026.

These are separate from the executive actions, and their impact on commercial permanent magnets will be substantial.

This article provides a clear explanation of what is coming, why it is unlikely to change, which HTS codes are affected, and what manufacturers can do today to prepare.

Why This Tariff Increase May Be Going Unnoticed

Most public discussion has focused on the IEEPA-based Executive Tariffs that imposed sweeping increases in 2025. But Section 301 tariffs follow a different legal pathway and have been on a staged implementation track for years.

Because they are not part of the executive action, and because magnet-specific HTS codes have been exempt until now, many users have not yet realized that the 25% Section 301 duty hits permanent magnets on January 1, 2026.

This change is additive to any pre-existing import duties.

Section 301 Tariffs: What’s Changing in 2026

Separate From Executive Tariffs, Section 301 authority comes from the U.S. Trade Act of 1974 and operates independently from presidential tariff actions. Unlike the 2025 Executive Tariffs:

• Section 301 has its own review cycle
• It does not expire with a change in administration
• It requires Congressional action to repeal

This makes it far more stable and more difficult to reverse, even if political conditions further evolve.

Phase-In Timeline

Permanent magnets under:

HTS 8505.11 (SmCo)

HTS 8505.19 (NdFeB and others)

have been exempt from Section 301 duties for years, but that exemption ends on January 1, 2026, at which point:

An additional 25% tariff will be applied on top of all standard duty rates and any Executive Tariffs in effect at that time.

This will materially change the landed cost of nearly every commercial magnet imported from China.

Executive Tariffs vs. Section 301 Tariffs, a Side-by-Side Comparison

Executive Tariffs (IEEPA) vs. Section 301 Tariffs

Characteristic	Executive Tariffs (2025 “Liberation Day” Tariffs)	Section 301 (2026 Permanent Magnet Tariff)
Legal Authority	IEEPA (Presidential authority)	Trade Act of 1974 (requires Congressional repeal)
Reversibility	Easily reversed by new administration	Historically stable; rarely reversed
Purpose	Broad economic pressure tool	Targeted response to unfair Chinese trade practices
Implementation Speed	Immediate	Multi-year planned rollout
Tariff Amounts	10–54%+ depending on product/country	+25% additional on specific HTS codes
Impact on Magnets	Major but fluid	Magnets (8505.11 / 8505.19) get a firm +25% on 1/1/2026

Magnets Impacted in 2026 – HTS Table with Tariff Loads:

HTS Code	Description	Baseline Duty	Section 301 Add-on (2026)	*IEEPA (Executive)	Total Jan 1, 2026
8505.11.00	Samarium Cobalt (SmCo) permanent magnets	2.1%	+25%	+ 20%	~ 47.1%
8505.19.10	NdFeB permanent magnets	2.1%	+25%	+ 20%	~ 47.1%
8505.19.20 / .30 / .40	Other permanent magnets	2.1%	+25%	+ 20%	~ 47.1%

* IEEPA Qualifier: The IEEPA Tariffs are a combination of reduced 10% Reciprocal and reduced 10% Fentanyl tariffs

– The Reciprocal Tariff remains at 10% under a US-China agreement and is set to expire Nov 10, 2026.

– The Fentanyl Tariff was reduced under the same US-China agreement and it too, is set to expire Nov 10, 2026.

– Actual re-escalation (beyond 10%) will depend on executive decisions, trade negotiations, retaliatory actions, or new national emergencies, but there’s no other publicly announced “review date” besides when existing suspension commitments expire.

Why the 2026 Section 301Tariffs Are Unlikely to Be Repealed

• Section 301 revisions were planned years in advance
• They survived multiple political review cycles
• Repeal requires Congressional action, which is historically rare
• Magnets are categorized as strategic goods
• Other products received exemptions; magnets did not
• Rare earth magnets are tied to critical infrastructure:

For planning purposes, companies should treat the Section 301 tariffs as long-term permanent costs.

How Companies Can Mitigate the Cost Impact

Because tariffs are applied to the declared customs value, the only durable way to reduce tariff burden is to lower the cost of the imported magnet. The only viable path to a lower-cost magnet is through engineering redesign, which changes either the configuration or the alloy system used.

A. Redesign Magnet Geometry to Reduce Tariff-Bearing Product Value

Tariffs scale directly with unit cost. Lower the cost → lower the tariff.

This is only achievable through engineering modifications, such as:

• Simplifying magnet geometry
• Reducing magnet mass through optimized circuit design
• Combining functions to create assemblies with fewer discrete magnets

Even modest configuration changes can materially reduce imported value.

B. Substitute Lower-Cost Alloys (When Technically Feasible)

Changing the alloy system is one of the most effective levers for lowering unit cost.

Potential substitutions include:

• Replacing high Energy Density alloy with lower energy alloy grades
• Replacing SmCo with high-temperature NdFeB, when thermal and demag conditions allow
• Reducing or eliminating Dy/Tb (heavy rare earth elements), which are major cost drivers
• Re-evaluating thermal or coercivity requirements that may have been specified conservatively in older designs

All substitutions require analysis which may involve magnetic modeling and validation to ensure equivalent performance.

C. Revisit Application Temperature Requirements

Operating temperature is one of the strongest contributors to alloy cost.

Reducing the required temperature rating allows:

• Use of lower-coercivity, lower-cost grades
• Reduction or removal of Dy/Tb
• Potential transition to non-HRE alloys

This is often an overlooked cost reduction opportunity.

Engage Early with Dura for Technical Redesign

Dura’s engineering teams can support:

• Magnetic modeling to preserve performance while reducing mass
• Redesign assistance to simplify geometry and reduce cost
• Grade substitution analysis (SmCo → Neo, or HRE-reduced recipes)

Early engagement produces the best results because redesign cycles and customer qualification steps require lead time. Contact Dura today to begin exploring engineering-led strategies that can mitigate tariff impact and ensure your magnet designs remain cost-effective and future-ready.

Citations & Sources:

This analysis is grounded in publicly available primary source material from the Office of the United States Trade Representative (USTR), including the Section 301 Four-Year Review and associated Final Action Notices; the Federal Register tariff modification schedules and implementation rules issued under both IEEPA and the Trade Act of 1974; the U.S. International Trade Commission (USITC) Harmonized Tariff Schedule classifications for HTS 8505.11 and 8505.19; White House Fact Sheets describing the 2025 Executive Tariff actions, reciprocal tariff reductions, and the U.S.–China tariff framework; U.S. Customs and Border Protection (CBP) guidance on country-of-origin determinations and substantial transformation; and Congressional Research Service (CRS) reports examining rare earth materials, critical supply chains, and strategic-goods risk assessments. These authoritative sources form the basis for the tariff timelines, rate calculations, and policy interpretations summarized in this article.