Trade Cases
![](https://www.steelmarketupdate.com/wp-content/uploads/sites/2/media/k2/items/src/bfec80d78e4eece86ef0d045417beed8.jpg)
Alcoa Requests Tariff Exemption for Canadian Operations
Written by Sandy Williams
August 7, 2018
A major aluminum company has requested that Canada be exempt from Section 232 aluminum tariffs so that it can import alloy from its Canadian mills.
Alcoa has three smelting facilities in Canada and three in the United States, as well as other global locations. The Baie-Comeau facility in Quebec produces specialty aluminum in 24-inch slabs, which are rolled into sheet at the Warrick facility in Indiana. The aluminum sheet is used by customers to make food and beverage cans.
Alcoa said it does not have the capacity at its U.S. plants to produce the required alloy and it is not available from its competitor (and only other aluminum smelter in the U.S.) Century Aluminum.
“Century Aluminum has indicated that it does not have the molds to produce 24-inch thick slabs,” Alcoa said. “There are no other U.S. manufacturers currently capable of supplying the exact slabs meeting Alcoa’s specifications or an acceptable substitute.”
Aluminum smelting has declined in the U.S. in the last several years as electricity costs increased at the aging facilities and foreign smelters improved efficiency and costs. Only 14 percent of Alcoa’s aluminum was produced in the U.S. last year.
“Even if all U.S. curtailed capacity was back online and producing metal, the U.S. would still need to import the vast majority of its required primary aluminum with approximately 60 percent from Canada, which is key to the North American supply chain,” said Alcoa President and CEO Roy Harvey during the company’s Q2 2018 earnings call.
“While tariffs have pushed the Midwest premium higher providing U.S. aluminum producers with a benefit, there is no long-term certainty to the duration of those tariffs. Tariffs also distort the market by incentivizing the restart of aged inefficient capacity, which contributed to curtailments and closures in the first place.”
Harvey added that the newest smelter in the U.S. is about 40 years old. About 300,000 metric tons of U.S. capacity has been added due to smelter restarts because of the tariffs, said Harvey, all of it from competitors. Alcoa plans to restart the smelter at Warrick to benefit its rolling mill, but capacity will remain curtailed at all three of its U.S. smelters.
Alcoa announced that due to current market prices, trade actions and operational factors, the company is reducing its 2018 adjusted EBITDA outlook to between $3.0 billion and $3.2 billion, down from $3.5 billion to $3.7 billion. Although the average realized price on raw aluminum surged 19 percent in the second quarter year-over-year, tariffs are costing the company between $12 million and $14 million per month.
When the Section 232 tariffs were first posted by the administration, Alcoa asked that Canada and allied trading partners be exempted from the 10 percent duty. In its submission on Monday, Alcoa filed five applications for one-year exclusions on primary aluminum alloyed slab from Canada.
“Once we see whether serious objections have been raised, it will be easier to evaluate the Alcoa application,” said James Rockas, a spokesperson for the Commerce Department, in an email to the New York Times.
According to the NYT, Century Aluminum has filed objections to several requests for aluminum exemptions and plans to restart a smelter in Kentucky.
In the steel industry, companies are finding their requests denied because of objections from steel producers. Alcoa could find itself in the same bind if objections are raised.
![](https://www.steelmarketupdate.com/wp-content/uploads/sites/2/2023/04/sandy-williams.jpeg)
Sandy Williams
Read more from Sandy WilliamsLatest in Trade Cases
![](https://www.steelmarketupdate.com/wp-content/uploads/sites/2/images/Featured_News_Icons/galvanized_coil.png)
Leibowitz: The consequences of a new barrage of trade cases on coated steel
Domestic steel producers and the United Steelworkers (USW) union filed a barrage of trade cases last week. This is hardly news. Ever since the Commerce Department ruled that Vietnam is still treated as a nonmarket economy (NME) for antidumping purposes, many in the business expected new cases on the product that Vietnam excels at—“corrosion-resistant steel.” Nor is it a surprise that these cases roped in nine countries in addition to Vietnam: Australia, Brazil, Canada, Mexico, the Netherlands, South Africa, Taiwan, Turkey, and the United Arab Emirates. All these countries rank in the top ten exporters of corrosion-resistant steel to the United States. These petitions are a broadside against coated flat-rolled steel imports.
![](https://www.steelmarketupdate.com/wp-content/uploads/sites/2/images/Featured_News_Icons/investigate.png)
Coated trade case alleges hefty dumping margins
Domestic mills have alleged substantial dumping margins in the trade case targeting imports of corrosion-resistant steel.
![](https://www.steelmarketupdate.com/wp-content/uploads/sites/2/images/Featured_News_Icons/fist.png)
US mills file sprawling trade case against coated imports from 10 nations
US mills have filed or soon will file a sprawling trade petition against imports of coated flat-rolled steel from 10 countries. The petition seeks anti-dumping margins against Canada, Mexico, Brazil, the Netherlands, Turkey, the United Arab Emirates, Vietnam, Taiwan, Australia, and South Africa. It also seeks countervailing duty margins against Canada, Mexico, Brazil, and Vietnam. That’s according documents dated Sept. 5 and addressed to Commerce Secretary Gina Raimondo and International Trade Commission (ITC) Secretary Lisa Barton.
![](https://www.steelmarketupdate.com/wp-content/uploads/sites/2/media/k2/items/src/cbd2ad03f626e665deb71b2742b25bbb.jpg)
Steel Summit 2024: Trade issues abound ahead of election
Trade is always front and center in an election year. And 2024 is no different. There is no shortage of issues, with questions like the sale of U.S. Steel to Japan’s Nippon Steel, potential cracks in the USMCA, and Chinese overcapacity dominating the headlines. But how do you distinguish between issues that might just last until November, and what are the crucial questions that could affect your business for years to come?
![](https://www.steelmarketupdate.com/wp-content/uploads/sites/2/images/Featured_News_Icons/fist.png)
US senators urge reduction to S. Korean OCTG quota
https://www.brown.senate.gov/newsroom/press/release/sherrod-brown-casey-fetterman-biden-administration-level-playing-field-american-octg-industry