Economy
SMA Sees USMCA Trade Pact as a Priority
Written by Tim Triplett
January 31, 2019
The Steel Manufacturers Association would like to see the U.S.-Mexico-Canada Agreement ratified by the three countries, even if it calls for a change to the tariffs.
Speaking at a press briefing during SMA’s board meeting Thursday in Washington, SMA President Phil Bell said the modernized trade rules in the USMCA are an improvement on NAFTA. “We support USMCA. There needs to be some kind of negotiated resolution to the Section 232 tariffs. It could be in the form of quotas or some other means to ensure that we have a free and open market without retaliation between the three countries,” he said.
“We are supportive of the agreement and the Section 232 tariffs based on national security,” added SMA Chairman Tracy Porter. “Any kind of agreement between the U.S., Canada and Mexico, as long as it levels the playing field and there is no transshipping happening to get around the goal of 232, we are very supportive.”
Asked whether capital investment by SMA members will focus on producing higher-value products, such as advanced high-strength steels, rather than commodity grades, the SMA executives said it would likely be a combination of both. As Bell noted, Nucor has announced new greenfield projects including rebar micromills and a new plate mill in the Midwest. Steel Dynamics has announced new flat roll capacity. JSW USA has restarted the EAF at Mingo Junction and plans to add a new $500 million melt shop to its pipe mill in Baytown, Texas, to name a few.
Does all this new capacity raise the risk of oversupplying the market and impacting prices in the future? “Overcapacity is an issue in China and other countries, but not here,” Bell said. Through the end of November, imports into the U.S. declined by 11 percent. Besides replacing import volumes, U.S. mills are looking to expand sales into other markets, such as Mexico. “It is not something we are worried about,” Bell added. “I have no concerns at all about capacity coming online that is efficient, run by companies with strong balance sheets and good management teams.”
SMA is a trade group representing EAF steel manufacturers in North America.
Tim Triplett
Read more from Tim TriplettLatest in Economy
Architecture firm billings remain down in January
Architecture firms continued to report a sharp reduction in billings in January, according to the latest Architecture Billings Index (ABI) released by the American Institute of Architects (AIA) and Deltek.
New York state manufacturing rebounds in February
Business activity in New York state’s manufacturing sector recovered nicely in February after a sharp decline the previous month, according to the latest Empire State Manufacturing Survey from the Federal Reserve Bank of New York. The general business conditions index rose 18 points to 5.7. This is a diffusion index, where a positive reading signifies […]
Dodge Momentum Index jumps to record high in January
The Dodge Momentum Index (DMI) rose to a record high in January, according to the latest data released by Dodge Construction Network.
CRU: China hits back with retaliatory tariffs on US
Targets include coal, liquified natural gas, crude oil, and other commodities
ISM: Manufacturing expands in January for first time in years
Following more than two years of contraction, US manufacturing activity rebounded in January according to the Institute for Supply Management.