January 27, 2020

President Trump Expands Section 232 Metals Tariffs, Will Not Release Auto 232 Report

As Bloomberg reports, on Friday, January 24, the Trump administration announced that it will expand its Section 232 tariffs so that it will cover certain imported nails, staples, electrical wires, some downstream parts that go into automobiles and tractors, and other products.

In a proclamation, President Donald Trump said, “Although imports of aluminum articles and steel articles have declined since the imposition of the tariffs and quotas, the Secretary [of Commerce] has informed me that imports of certain derivatives of aluminum articles and imports of certain derivatives of steel articles have significantly increased since the imposition of the tariffs and quotas. The net effect of the increase of imports of these derivatives has been to erode the customer base for U.S. producers of aluminum and steel and undermine the purpose of the proclamations adjusting imports of aluminum and steel articles to remove the threatened impairment of the national security.”

Beginning February, 8, 2020, these imports of derivative aluminum products will be subject to an additional 10 percent duty while the imports of derivative steel products will face a 25 percent tariff. According to The Hill, those levies will be in addition to the original Section 232 tariffs for aluminum, which are 10 percent, and for steel, which are 25 percent.

Argentina, Australia, Canada and Mexico will be exempt from the levies on aluminum products while Brazil, Argentina, Canada, Australia, Mexico, and South Korea will be exempt from the steel tariffs. (Incidentally, according to a new study by the Mercatus Center, U.S. steel importers have filed a total of 93,933 requests for exclusions from Section 232 steel tariffs. Half have been approved, 14 percent have been denied, and 36 percent remain pending. Aluminum importers have requested 13,249 exclusions. Forty-nine percent have been approved, seven percent have been denied, and 45 percent are pending.)

In related news: the U.S. Department of Commerce has ignored a provision that was included in the fiscal year 2020 spending bill signed by Trump on December 20, 2019 that required, within 30 days, the department to publish the results of its 2018 Section 232 investigation on auto imports.

Additionally, President Donald Trump and U.S. Treasury Secretary Steven Mnuchin told world leaders assembled at the World Economic Forum in Davos, Switzerland last week that the United States is not opposed to imposing “arbitrary taxes” on European automobile imports. Stay tuned to Connecting the Dots for all news related to the Trump administration’s Section 232 tariffs.