Tariffs reinstated on Canadian aluminum
President Trump announced that the U.S. would reimpose 10 percent Section 232 tariffs on imports of Canadian aluminum effective Aug. 16. This action is based on the administration’s finding that “Canadian companies are flooding the U.S. market and reducing employment in the U.S. aluminum industry.”
In May 2019, as part of negotiations for the United States – Mexico – Canada Agreement (USMCA), the U.S. agreed to remove the Section 232 steel and aluminum tariffs on imports from Mexico and Canada. In exchange, Mexico and Canada repealed their retaliatory duties on various U.S. goods. The agreement gave all three countries the authority to reimpose sector-specific tariffs if imports surged and consultations failed. According to the agreement, if any country reimposes sector-specific tariffs, the exporting country can only retaliate in the affected sector, in this case aluminum and aluminum-containing products. Canada has announced a retaliatory tariff on U.S. aluminum goods effective Sept. 16.
According to the Coalition of American Metal Manufacturers and Users (CAMMU), of which NAFEM is a member, “The North American supply chain is integrated and aluminum-using manufacturers on both sides of the border will be hurt by these tariffs. Tariffs are taxes and the last thing U.S. manufacturers needed was for the government to raise the cost of this important input while companies are dealing with the challenges resulting from the COVID-19 pandemic.”
“Given the recent U.S. Court of International Trade (CIT) decision that overturned the administration’s actions to double the Section 232 steel tariffs on Turkey months after the statutory time to take action, U.S. importers are expected to appeal,” said Christine Sohar Henter, NAFEM legal counsel, Barnes & Thornburg. “However, President Trump often leverages executive orders to advance his agenda and no one is acting fast enough to challenge his actions. This is especially the case since the CIT and other courts slowed down due to the COVID-19 pandemic.”