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May 25, 2020

U.S. Wants Input On Section 232 Metals Tariffs Exclusion Program

As its member companies are aware, the Metals Service Center Institute (MSCI) submitted comments to the Trump administration in 2017 supporting Section 232 tariffs on steel and aluminum, calling for exemptions for products from Canada and Mexico and consideration of the impact on downstream demand (Click here to read the submitted comments for both steel products, and aluminum.)

Those tariffs now have been in place for two years, and there were two important developments on the Section 232 penalties last week. Connecting the Dots offers the following news for its members’ information only. MSCI has not taken a position on either matter.

On May 22, the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) announcedthat it is seeking comments from the public regarding “how to improve the exclusion process for” the steel and aluminum penalties. Commerce Secretary Wilbur Ross said the department is “continually looking for ways to improve the exclusion process” because it wants “these critical national security measures to be applied effectively while avoiding unnecessary impacts on downstream American industries.”

The BIS is seeking input on a number of topics, including the appropriateness of the information requested and considered in applying the exclusion criteria and the process employed in rendering decisions on requests for exclusions. It will accept comment submissions from May 26, 2020 through July 10, 2020.

Comments may be submitted through www.regulations.gov using the identification number BIS-2020-0012. Commenters should refer to RIN 0694-XC058 in all comments and in the subject line of comments that are emailed to BIS. Rebuttal comments will be accepted until August 10, 2020 and should only address issues raised in comments filed on or before July 10, 2020.

Also last week: as MetalMiner reported, the Aluminum Association sent a letter to U.S. Trade Representative Robert Lighthizer supporting exclusions to the Trump administration’s Section 232 tariffs for products from the Canada and Mexico, but criticizing the Section 232 exemption process.

The letter, which is available here, said the exclusions for Canada and Mexico were necessary because, “even if every U.S. aluminum smelter was operating at full capacity, aluminum manufacturers would still require a mix of domestic and imported primary aluminum as well as secondary production to meet the demands of U.S. manufacturers and consumers for aluminum products.”

Regarding the exemption process, the letter said, “[T]he administration of the Section 232 product exclusion process has created distortions in the U.S. market by incentivizing imports of semi-fabricated aluminum.” The Aluminum Association noted, “Since the beginning of the program in 2018, the Commerce Department has granted tariff exclusions covering more than 22 billion pounds of aluminum – including more than 4 billion pounds of aluminum products from China, the most granted for any single country.”