US Commerce Department Announces Some Aluminum Tariff Relief

- August 30th, 2018

After levying strong tariffs on aluminum, steel and a host of other products earlier this year, the Trump administration has rethought its position on foreign imports.

After levying strong tariffs on aluminum, steel and a host of other products earlier this year, the Trump administration has rethought its position on foreign imports.

Earlier this week, US President Trump issued a proclamation permitting targeted relief on steel and aluminum quotas from some countries; specifically, South Korea, Argentina and Brazil.

“President Trump has once again shown his commitment to American workers and businesses, protecting our national security from the threat posed by steel and aluminum imports,” said Secretary Wilbur Ross in a press release.

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“This proclamation provides the Department the same product exclusion authority for quotas that we already have for tariffs.”

The announcement comes just days after the president reported reaching a NAFTA arrangement with Mexico and in the middle of NAFTA negotiations with Canada, both countries missing from the short list of countries eligible for a tariff reduction.

Citing an investigation into auto parts under section 232 of the 1962 trade expansion act, Trump issued the 25-percent tariff on steel and the 10-percent tariff on aluminum in March. They were instantly met with objections from companies in and out of the US.

“There is evidence suggesting that, for decades, imports from abroad have eroded our domestic auto industry,” Secretary Ross said at the time. “The Department of Commerce will conduct a thorough, fair, and transparent investigation into whether such imports are weakening our internal economy and may impair the national security.”

According to the newly released proclamation, companies may apply for product exclusions based on insufficient quantity or quality available from domestic steel or aluminum producers. In these cases, an exclusion from the quota will be issued and no tariff would be owed.

The exemption also applies to steel that was contracted prior to the imposing of the tariff and cannot enter the US because a quota has already been reached. For these companies the quota will be waived, however the tariff will still need to be paid.

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Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.

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