Commerce Department Recommends President Impose Tariffs Or Quotas On Steel, Aluminum Imports
The U.S. Commerce Department last Friday released the results of its Section 232 investigations into how imports of steel and aluminum into the United States impact the country’s national security. President Donald Trump requested these investigations last April. The department found that current levels of imports into both steel and aluminum threaten U.S. security.
As a result, for steel the Commerce Department proposed the president take one of three actions. Impose:
- A global tariff of 24 percent or more on all imports of all of the covered steel products from all countries;
- A targeted tariff of 53 percent or higher on covered steel imports from 12 countries (Brazil, China, Costa Rica, Egypt, India, Malaysia, Korea, Russia, South Africa, Thailand, Turkey, and Vietnam) combined with quota for all other countries that limits those countries’ respective imports to 100 percent of their 2017 exports to the United States; or
- A global quota that limits imports from all countries to 63 percent of their total 2017 exports into the United States.
The products that would be affected by the tariffs and quotas are listed starting on page 21 of the steel report.
For aluminum, the department also proposed three options:
- A global tariff of at least 7.7 on all imports of all of the identified aluminum products from all countries;
- A targeted tariff of 23.5 percent or more on all covered aluminum imports from China, Russia, Hong Kong, Venezuela, and Vietnam combined with a quota for all other countries that limits their imports to 100 percent of 2017 imports; or
- A global quota that would limit imports from all countries to 86.7 percent of their total 2017 exports to the United States.
The products that would be affected by the tariffs and quotas are listed starting on page 20 of the aluminum report.
As American Metal Market (subscription required) explained, the Commerce Department provides no timeline for when the tariffs or quotas might be lifted. Secretary Wilbur Ross said they “could be canceled at any time that the president chooses.”
President Trump is now reviewing the Commerce Department’s recommendations and has until April 11 to make his decision for steel and until April 19, 2018 to make his decision regarding aluminum. As the Commerce Department explained last Friday, “The President may take a range of actions, or no action.” Additionally, “Action could include making modifications to the courses of action proposed, such as adjusting percentages.”
If the president decides to impose a tariff or quota, the reports recommended that the Commerce Department put in place an appeal process by which the U.S. Commerce Secretary may grant requests from U.S. companies to exclude specific products if the U.S. lacks sufficient domestic capacity or for national security considerations.
As a reminder, in its recommendations to the Trump administration regarding aluminum and steel, the Metals Service Center Institute requested that imports from Canada and Mexico be excluded from any Section 232 trade penalties. After the Commerce Department released its reports, the United Steelworkers made the same request.