BREAKING NEWS: US Imposing Metal Tariffs on EU, Canada, and Mexico
The White House announced today it was moving forward with tariffs on steel and aluminum imported from the European Union, Canada, and Mexico.
Those countries were exempted from the initial metal tariffs, announced in March, while the Trump administration attempted to use the threat of tariffs to push other issues such as voluntary limits on exports to the US and cutting tariffs on other products. The rationale for the tariffs was to promote the production of the domestic industries and to protect national security.
Secretary of Commerce Wilbur Ross told CNBC today that discussions with the Europeans were ongoing, but that progress was not sufficient to continue the tariff exemption. He also reiterated his earlier argument that the tariffs did not amount to much in the context of the US economy and that it would only add fractions of cent to the costs of cans of soda and beer. He also told reporters, “We take the view that without a strong economy, you can’t have strong national security.”
The 25-percent tariff on steel and the 10-percent tariff on aluminum from the European Union and the US’s NAFTA partners, which collectively supply around half of the country’s imported metals, will go into effect at midnight tonight.
Mexico has already announced retaliation against US exports, targeting grapes, pork bellies, apples, and flat steel. The EU promulgated list of US products to target in retaliation when the Trump tariffs were first announced, while Chrystia Freeland, Canada’s foreign minister, was quoted by The New York Times as saying the idea that metal imports from Canada could threaten US national security “frankly absurd.” Canada has imposed retaliatory tariffs on US exports of steel, aluminium, whiskey, toilet paper, and more.
Thom Dammrich, president of the National Marine Manufacturers Association (NMMA), the trade group for the US recreational boating industry, noted that US builders of aluminum boats primarily use domestic aluminum. “The issue with these tariffs is not so much about having to pay higher prices for imported aluminum as it is about the drastic price increases our members are already experiencing from domestic aluminum mills and the severe blow to the competitive global market manufacturers depend on,” he explained. “Simply put, these tariffs are a disaster for our industry. All types of recreational boats are on the retaliatory lists from both Canada and the EU. These tariffs directly harm the entire recreational boating industry. To make matters worse, Canada, Mexico, and the EU are the top three export markets for American-made marine products and in 2017 they accounted for nearly 70 percent of marine exports.”
“Restricting the raw material supply in the US and imposing tariffs on imports from our closest trading partners places American manufacturers directly in harm’s way,” said Paul Nathanson, spokesperson for the Coalition of American Metal Manufacturers and Users. The pain will by no means be limited to the manufacturing sector; a slew of other U.S.-made products will soon be penalized with retaliatory tariffs by our major export trading partners.
“Our member manufacturers––even those who only use steel and aluminum produced in the US—have already experienced price spikes and increased lead times for the steel and aluminum inputs they use to make finished products,” he added. “The bottom line is that when US manufacturers pay vastly more for steel and aluminum than manufacturers anywhere else in the world it undermines their ability to compete and be successful on the global market. The tariffs particularly impact small and medium sized companies who will lose business to their overseas competitors.”