In March 2018, the Trump Administration put into effect new metal trade tariffs for the good of the American metal industry. In a March 1 listening session the president detailed the metal tariff plans with support from several top representatives in the steel and aluminum industry. The metal tariffs were expected to be revolutionary for affected companies but also added to the beginning of what many believe to be a new global trade war.
“..You will have protection for the first time in a long while, and you’re going to regrow your industries. That’s all I’m asking. You have to regrow your industries,” Trump said to metal company executives in the March 1 listening session.
The effects of these tariffs have been felt across the world with numerous aftershocks and negotiation plans deeply centered around actions in the metal industry. The March 2018 announcement included a 25% tariff on imported steel and a 10% tariff on imported aluminum with the effects on the metal industry and global economy yet to be seen.
Trump’s metal tariffs added to new tariffs on solar panels and washing machines. The metal tariffs were also a segway to a separate tariff focus on China.
Who Is Taxed on Metal Imports?
The metal taxes include nearly every country in the world. Four countries have received special permanent exemptions from steel tariffs, including: Australia, South Korea, Argentina, and Brazil. While the U.S. reportedly signed a ‘New NAFTA’ deal with Canada and Mexico, government approvals of the deal are being held up by the 25%/10% tax in the metal industry.
U.S. Steel Imports: How Much Steel Does the U.S. Import?
The actions in the U.S. steel industry beg the question, ‘Where does the U.S. import steel from?’ To understand more clearly how these metal imports will affect the U.S. and the world it is helpful to break down the U.S.’s steel imports overall.
In 2017, the U.S. was the world’s largest steel importer. According to the International Trade Administration’s Global Steel Trade Monitor report, the U.S. imported 30.8 million metric tons of steel, which was an 11% decrease from 34.5 million metric tons in 2017.
In 2018, the U.S. imported 77% of its steel imports from 10 countries noted below. These countries each accounted for more than 950 thousand metric tons of steel.
Exports: How Much Steel Does the U.S. produce?
According to the ITA as of February 2019:
The United States was the world’s fifteenth-largest steel exporter in 2017. In 2018, the United States exported 8.4 million metric tons of steel, a 17% decrease from 10.1 million metric tons in 2017.
The U.S. reciprocates exports primarily to Canada and Mexico.
Who are the largest US steel producers?
U.S. Steel Industry Watch List
The new actions in the metal industry continue to have ongoing affects for the industry itself, the U.S. economy, and global trade. As such there are several key areas to watch as the integration of the new metal tariffs take place.
U.S. metal companies: There are seven top U.S. steel producers to watch. Additionally, the NYSE Arca Steel Index represents a significant portion of U.S. steel companies collectively. (See also, Top 5 Steel Stocks of 2019)
USMCA: Government approvals continue to be ongoing in the New NAFTA deal agreed on in November 2018.
Monthly and Quarterly Data: The metals market is undergoing several changes affecting trade globally and profits for U.S. companies. There are several sources for ongoing data analysis, including: the International Trade Administration’s monthly country reports on steel imports and exports and the U.S. Census Bureau’s International Trade data report.
Ongoing Trade Negotiations: The metal tariffs are a basis for U.S. trade retaliation across the globe. Trade relations with China are getting the most attention in 2019 as China deals with the new metal tariffs along with separate tariffs the U.S. has imposed on the country.