Trade Cases
AIIS Panel Warns Against Section 232
Written by Sandy Williams
September 16, 2017
“Dangerous, unintended consequences” could result from the Section 232 national security investigation of steel imports, said members of a panel hosted by the American Institute for International Steel, which represents foreign steel producers.
“Our objective today is twofold,” said John Foster, AIIS chairman and president of Kurt Orban Partners, in his opening remarks, “First, to highlight the critical importance of the steel supply chain to our ports, the U.S. marine transportation system, and to the entire American economy; and second, to present compelling new evidence pointing to the potential economic disaster that may befall the steel supply chain, and other sectors of the American economy, like agriculture, if the administration imposes Section 232 trade restrictions on imported iron and steel products.
A report compiled by Martin and Associates analyzed the economic impacts of imported iron and steel products on the national marine transportation system and domestic users. The analysts found that 34.4 million short tons of iron and steel handled at U.S. seaports last year supported 1.3 million jobs, and nearly $240 billion of total economic activity, or 1.3 percent of total U.S. GDP last year.
The vessels that import steel to American shores are used in turn to export grain from the U.S. to overseas destinations. About 47 million tons of grain were exported via the lower Mississippi River in 2016, generating 10,830 direct, induced and indirect jobs and supporting 39,000 jobs in the agricultural industry.
“If restrictions are imposed on the imported iron and steel products, not only will the 1.3 million jobs be at risk, but the ocean cost to export grain from the U.S., particularly from the Lower Mississippi River, will increase due to the restricted number of vessels that will be available to carry grain exports,” explained John Martin of Martin Associates. “This in turn will have a ripple effect into the nation’s agricultural sector.”
Representatives of the National Chicken Council and the American Soybean Association expressed concerns about shipping disruptions and trade retaliation. Kevin Brosch, attorney for the National Chicken Council, noted the retaliatory duty on chickens imposed by China after the Obama administration placed a 35 percent tariffs on tires in 2009. Brosch added that the poultry industry has yet to recover from that incident.
Foster challenged the notion of “adding more government-mandated protections for what is already the most protected industry in the country.” To do so, he said, “is not a constructive or logical approach.”
Foster went on to note that:
1. Many of the mills that blame imports for their downfall went bankrupt because pension and health care obligations were poorly managed;
2. More than half of the AD/CVD orders on the books today involve steel and have been in place for some time;
3. The steel industry is profitable, with five of the six largest companies returning total profits of $654.6 million in first-quarter 2017.
“All of this is compelling evidence for why the Section 232 national security investigation of steel imports should be immediately terminated,” said Foster.
Sandy Williams
Read more from Sandy WilliamsLatest in Trade Cases
Price on Trade: The foolishness of free trade with controlled economies
It was only a matter of time before a shutdown happened. And, no, we aren’t talking about the federal government’s lapse in appropriations. On Oct. 9, Beijing announced a series of restrictions that will effectively shut down exports of rare earth elements, magnets, and certain downstream products vital to advanced manufacturing.
Trump pulls plug on trade talks with Canada after anti-tariff Reagan ad
US President Donald Trump took to social media late Thursday night to announce he was canceling trade talks with Canada.
Leibowitz: Renewed trade war with China over rare earths
On Oct.10, President Trump announced major increases in tariffs on Chinese goods. The trigger was a new regime of export controls on rare earth metals and products using those elements, including magnets, capital equipment, and catalysts for catalytic converters in cars and trucks.
Industry piles on new Section 232 steel derivative inclusion requests
The Department of Commerce received 97 submissions from producers, manufacturers, and groups seeking Section 232 tariff coverage for steel and aluminum derivative products.
Price on Trade: New EU steel tariffs don’t mean the US should weaken its stance
Any steel imports into the EU that exceed the new, lower quota level would be subject to a 50% tariff, which represents a major increase from the EU’s current 25% out-of-quota tariff. This move would largely align the EU’s steel tariff rate with Canada and the United States.