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US steel producers cheer Trump's tariff

Pittsburgh (Platts)--8 Mar 2018 1048 pm EST/348 GMT


US steelmakers were unsurprisingly upbeat Thursday as US President Donald Trump signed a presidential proclamation establishing a new 25% tariff on steel imports.

The tariff, which is to take effect March 23, excludes Canada and Mexico and allows for the possibility of additional product or country exemptions.

"We have to protect and build our steel and aluminum industries while at the same time showing great flexibility and cooperation for those that are really friends of ours, both on a trade basis and a military basis," Trump said at a White House event Thursday before signing off on the tariffs.

Related feature: Trump's steel and aluminum import tariffs

The proclamation stated that the tariffs are "necessary and appropriate" in light of "many factors considered," including the Department of Commerce's Section 232 investigation into the effect of imports on national security, updated import and production numbers for 2017, the failure of countries to agree on measures to reduce global excess capacity, the continued high level of imports since the beginning of the year, and special circumstances that exist with respect to Canada and Mexico.

"The president's action today is key in stemming the tide of unfair foreign imports and putting steel workers back to work," American Iron and Steel Institute CEO Thomas Gibson said in a statement. "... With the signing today, the steel industry can be on track to maintain our essential contributions to national security and critical infrastructure like transportation, public health and safety, energy and the power grid, all of which rely heavily on steel."

A number of mills also published statements thanking Trump for his leadership in addressing the issue of imports.

Philip Bell, president of the Steel Manufacturers Association, said his organization is optimistic these tariffs will adjust imports to provide a level playing field for US producers.

"We look forward to the measures being in effect for a period of sufficient duration for companies to reinvest in the steel industry," Bell said. "We also support limited exceptions for key allies, including Mexico and Canada, well-regulated exclusions for products not available from US producers, and mechanisms to avoid transshipment and circumvention of the tariffs."

The proclamation stated that any steel article determined not to be produced in the US in a sufficient and reasonably available amount, or of a satisfactory quality, could be eligible for a tariff exclusion. A request for an exclusion must be made by a directly affected party located in the US. Commerce Secretary Wilbur Ross has 10 days from the signing of the proclamation to issue procedures for the exclusion requests.

United States Trade Representative Robert Lighthizer will be negotiating any potential country-specific exclusions, Trump said.

Tadaaki Yamaguchi, chairman of the Japan Steel Information Center, said his organization looks forward to "educating the Trump Administration on the vital role the Japanese steel industry plays in the American marketplace."

"The Japanese industry is not part of the import problem but a solution," he said in a statement. "We are proud to be an essential partner of the American manufacturing economy."

The United Steelworkers union, which represents steel mill employees in both Canada and the US, said that while Canada is not one of the countries "cheating" with its steel imports, both Canada and Mexico need to take the necessary steps to ensure they do not become points of circumvention for imports into the US from other nations.

"This is something our members on both sides of the border have been affected by and it's time for our allies to join us," USW International President Leo Gerard said in a statement.

--Justine Coyne, justine.coyne@spglobal.com

--Edited by Lisa Miller, lisa.miller@spglobal.com

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