On March 1, President Trump announced his intention to impose a 25 percent tariff on imports of primary steel and a 10 percent tariff on imports of primary aluminum in a move that, he believes, could help prop up the U.S. domestic steel and aluminum sectors that have been impacted by the global overcapacity of these commodities.
The Trump Administration on March 8 released more details regarding these tariffs proving some flexibility for Canada and Mexico specifically as well as other nations with an “important security relationship’ with the United States.
Before the March 8 announcement, governments of major steel and aluminum suppliers – Canada, China, Brazil, Mexico, and the European Union – reacted by issuing threats of retaliation against U.S. trade interests, which according to reports are likely to be targeted towards agriculture and consumer good exports from key Republican districts. Because of this, Republican lawmakers are supportive of tough action against certain unfair trade practices but are worried about a potential trade war that could impact their success in the mid-term elections. Congressional Republicans sent a letter to the President urging restraint against our close trading partners. Furthermore, the announcement came as the United States, Canada, and Mexico were in the middle of the seventh round of NAFTA renegotiations, and it could have an impact on the tenor of meetings (though negotiations were already not expected to conclude this year).
For recyclers, the implications will be determined by the market. There is speculation that raising the cost of steel and aluminum imports will boost production in the United States, but it is also not anticipated that production in other countries will abate. ISRI will be carefully tracking steel and aluminum markets to advise our members on how the markets react.
For more information, please contact Adina Renee Adler