Metal Users Want Section 232 Tariff Relief During Coronavirus Pandemic
The coronavirus pandemic has made its mark on supply chains, leaving some companies looking for relief. For some, that means petitioning for tariff relief, particularly from President Donald Trump’s Section 232 steel and aluminum tariffs. One industry group, the Coalition of American Metal Manufacturers and Users (CAMMU), has asked for a pause to the tariffs, originally imposed in March 2018.
“The Coalition of American Metal Manufacturers and Users (CAMMU) strongly urges the Trump Administration to immediately terminate the Section 232 steel and aluminum tariffs to help U.S. manufacturers during this time of unprecedented crisis caused by the COVID-19 pandemic,” the group said in a statement last week. “If immediate termination is not possible, CAMMU urges at least a 90-day pause on tariff collections as small and medium manufacturers struggle with cash flows. Quick and decisive action to mitigate the ongoing economic damage to manufacturers is urgently needed right now.”
Conversely, steel industry groups are predictably against any pause or delay of tariff payments.
Five steel industry groups—American Iron and Steel Institute (AISI), Steel Manufacturers Association (SMA), Specialty Steel Industry of North America (SSINA), The Committee on Pipe and Tube Imports (CPTI) and American Institute of Steel Construction (AISC)—recently sent a letter to Mark Morgan, acting commissioner of Customs and Border Protection (CDP), to express their concerns.
In the letter, the groups expressed concern about “a communication posted through the Cargo Systems Messaging Service (CSMS) on March 20, which notes that CBP will grant ‘additional days for payment of estimated duties, taxes, and fees’ on a case-by-case basis as a result of the emergency situation, and the possibility that a longer-term policy may be forthcoming.”
“The steel industry in the U.S. appreciates the efforts the administration has been making to limit the spread and impact of the COVID-19 pandemic, particularly on businesses and the broader economy,” the groups said in the letter. “Any efforts to delay or reduce the collection of duties on unfairly-traded steel imports or imports that threaten to impair U.S. national and economic security will ultimately hurt U.S. workers and businesses during this unprecedented moment.”
The letter continues, calling for the ongoing collection of Section 232 duties during the coronavirus pandemic, in addition to collection of duties associated with Section 301 measures against China. (The U.S. Trade Representative launched a Section 301 investigation in August 2017, focusing on Chinese trade practices and accusations of intellectual property theft and forced technology transfer, among other accusations).
“Duties imposed under Section 301 should also continue to be collected,” the letter stated. “USTR has effectively used this trade provision to combat unfair trade practices and forge a Phase One agreement with China. There are obvious concerns that a policy allowing late payment of duties could lead to a flood of imports.” U.S. steel imports declined 17% in 2019 compared with the previous year. Meanwhile, through the first two months of 2020, U.S. steel imports were down 21%. Source: MetalMiner, 03.30.2020
To continue reading more articles this month, check out our full O’Neal Steel Market Informer.
You can view each month’s Market Informer, on our blog, The Knowledge Tree.