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June 29, 2020

Trump Administration Reportedly Considering Aluminum Tariffs For Canada

Several news sources reported last week that President Donald Trump is considering whether to reimpose his Section 232 tariffs on aluminum products from Canada.

After putting in place penalties on all steel and aluminum imports in 2018, the Trump administration repealed those penalties last year. Metals Service Center Institute President and CEO Bob Weidner praised that decision.

In a press release issued at the time, Weidner noted, “From the moment President Trump was considering 232 tariffs on metals’ imports, MSCI argued North American trading partners should be exempt. We are pleased with this decision, and also are pleased that Canada and Mexico have responded in kind. The relationship between these countries benefits metals workers and their families, and the North American economy. This action is a good step toward preserving and strengthening this important relationship.”

As Politico explained, the Trump administration is now worried that aluminum and steel exports from Canada and Mexico have “surged” in recent months. Before his administration puts back in place the 232 penalties, President Trump reportedly has asked Canadian Prime Minister Justin Trudeau to act to reduce exports from Canada to the United States by imposing quotas.

Canadian Ambassador to the U.S. Kirsten Hillman said, “We firmly believe that the Canadian aluminum exports to the U.S. aren’t hurting the U.S. market in any way.”

Under the 2019 agreement lifting the penalties for Canada and Mexico, preserved the right to raise duties again after it consults with Canada and “in the event that imports of aluminum or steel products surge meaningfully beyond historic volumes of trade over a period of time.”

Despite that provision, international trade experts told Politico reporters they are uncertain whether President Trump has the authority to reimpose Section 232 tariffs on Canadian aluminum. Council on Foreign Relations Senior Fellow Jennifer Hillman said a U.S. Court of International Trade case has found the Section 232 statute “does not provide ongoing authority to impose tariffs.” The Cato Institute’s Simon Lester said, “The further along we are in terms of the timeline, and the more arbitrary the administration’s actions seem, the better the chances of a successful court challenge.”

Industry groups are starting to request that President Trump reconsider his threat. Last week, the Aluminum Association sent a letter to U.S. Trade Representative Robert Lighthizer opposing the re-imposition of tariffs on aluminum products from Canada.