Edelman has gathered reactions to the new US steel and aluminium tariffs from all the key players. This briefing note contains relevant market data and regulatory updates as well as initial analysis on changes likely to come in the following days and weeks.
On March 7, 2018, president Donald Trump moved to place a 25 percent tariff on steel and 10 percent on aluminum imports from all nations, with temporary exemptions for Canada and Mexico. This measure was grounded on a seldom-used law from the 1960s that was designed to protect key domestic industries deemed vital to national defense. It should be noted that Canada is the largest steel and aluminum exporter to the US, while Mexico holds the fourth place in steel exports.
This move triggered negative reactions within the Republican Party, with Paul Ryan, Speaker of the United States House of Representatives, Gary Cohn, former director of the National Economic Council, and Ben Sasse, Republican Senator for the state of Nebraska, utterly opposing the tax reform law3. Meanwhile, companies like U.S. Steel and Century Aluminum applauded this decision by announcing investment plans and projects to reactivate idled smelters.
Furthermore, this measure has aggravated tensions on NAFTA negotiations. While the US sees this measure as a factor to push forward negotiations, Mexico and Canada have declared that they will not yield to US pressure.
On Thursday, May 31 commerce secretary, Wilbur Ross, announced the imposition of a 25 percent tariff on steel and 10 percent on aluminum imports from the European Union, Canada, and Mexico.
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