A recent study of the effects of the Trump Administration’s Section 232 tariffs on aluminium and steel shows that the move has done vastly more harm than good for the domestic aluminium industry.
An email penned by the senior director of public affairs at the Aluminum Association Matt Meenan to industry media detailed a study by the Mercatus Center that analyzed data on the transparency of the Section 232 exclusion process, the volume of requests received, and the countries from which those companies exempted hailed.
Per Meenan’s email, fully 60 percent of the exclusions submitted to date by steel and aluminium producers still lacked a decision by December 20. Over three-quarters of the requests by steel producers continued past the announced 90-day window according to the study’s authors.
Such a situation is not acceptable for the aluminium industry in the United States Meenan noted.
“The current Section 232 tariff exclusion process is not working for the domestic aluminum industry. The process is cumbersome, lacks appropriate tracking and analysis and is being executed in a way that undermines the goal of getting tough with countries like China.”
Though the administration cited imports from the People’s Republic of China as the prime culprit, 15 percent of the exemptions granted were for Chinese interests, as compared to the 3 percent submitted by Canadian and Indian firms.
Further, the volume of exports covered by the Section 232 tariffs was relatively minuscule, with imports excluded thanks to exemptions constituted 86 percent of the 2017 total of imported Chinese aluminium.
“Given the relatively large amounts of approved tariff exclusion requests on imports from China, these findings cast doubt over the administration’s assertion that imports of steel and aluminum were a national security threat,” concluded the study’s researchers.
With these results in hand, the Aluminum Association again took the Trump Administration to task for failing to address Chinese imports.
“China’s aluminum capacity has grown by more than 62 percent over the past five years [2013-2018], and by an additional six percent just last year, despite the administration’s tariff regime. The Aluminum Association continues to call for the removal of Section 232 tariffs on all countries designated as market economies by the Department of Commerce and for a renewed focus on Chinese overcapacity as the center challenge facing US aluminum producers.”
For its part, the Commerce Department told S&P Global Platts in November that extended review times were beneficial
“The rebuttal/surrebuttal process increases the review time but affords parties the chance to further focus the information they provide, thus better informing the Department’s reviews,” explained the source.