Where will the President’s 25% tariff on steel and 10% tariff on aluminum imports take US industry?

March 27, 2018 – The big question facing many manufacturers is how will these tariffs affect their cost of doing business? The answer: it’s still not entirely clear.

Alfred Figuly 2012 photo

While Canada, Mexico, EU countries, South Korea, Australia, Argentina and Brazil appear to have avoided the brunt of steel import tariffs, Chinese steel (and aluminum) remains the primary target.

According to a statement by Marshall Miller at Miller & Co., “The White House Proclamations on these tariffs indicate that the President intends to retain … “authority to further modify tariffs, remove suspensions for countries, exclude on a long-term basis a particular country, suspend tariffs on countries not included in the original list, or impose quotas on imports from ‘suspension’ countries.”

There is an exclusion process provided for in the Federal Register. Manufacturers are urged to immediately seek exclusions for their products. Especially vulnerable may be steel and aluminum products already on the water.

The Presidential Memorandum directs the US Trade Representative (USTR) to publish a full list of products affected. The list will allegedly include aerospace, information and communications technology and machinery. The USTR has testified that ten specific categories of products will include advanced information technology, aerospace and aeronautics equipment, maritime equipment in high tech shipping, modern rail transport equipment, new energy vehicles and equipment, power equipment, agricultural equipment, new materials, biopharma, and advanced medical products.

Al Figuly, President of the Greater Kansas City Foreign Trade Zone (GKCFTZ), said, “The information I’ve reviewed reinforce my feelings that supplies, components, and assemblies coming from China (directly and perhaps through other countries) could eventually be subject to higher tariffs “. As the product list is released, companies will want to use the comment period to review details on particular product of concerns. Mitigation strategies to defer, eliminate, or recover the excess duties, such as utilizing US Foreign Trade Zones or substitution drawback should also be carefully reviewed.

Mr. Miller further notes that the Customs & Border Patrol (CBP) will undoubtedly will be very carefully checking the Harmonized Tariff Schedule (HTS) on Customs entry for accuracy, therefore manufacturers need to review their HTS list Item Master against steel and aluminum Annexes.

If you have questions about this subject, contact Mr. Al Figuly at alfiguly@gkcftz.com

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