US and Mexico are in talks to remove the 50% tariffs imposed by President Donald Trump on steel imports from Mexico by capping imports to a certain volume, Bloomberg reported Tuesday, citing people familiar with the matter.

The talks, which are not finalized yet, are led by Commerce Secretary Howard Lutnick and will require Trump's approval, the news report said.

US importers will be able to bring in Mexican steel duty-free if they keep total number of shipments under a level based on historical trade volumes, the report said, citing sources. This cap would be "higher than what was allowed under a similar deal during Trump's first term," the sources told Bloomberg.

The White House and Mexican President's office didn't immediately respond to a request for comment from MT Newswires.

Shares of US steel firms Cleveland-Cliffs (CLF) and Nucor (NUE) declined after market hours, with CLF down more than 8% and NUE down more than 5%.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)