Author Topic: Mr. Trump to Impose Stiff Tariffs on Steel and Aluminum  (Read 62948 times)

Spekulatius

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Re: Mr. Trump to Impose Stiff Tariffs on Steel and Aluminum
« Reply #10 on: March 01, 2018, 04:24:22 PM »
Do you know if steel and aluminum are major imports for the U.S.? I believe I read/heard that it isn't a very big import, and it becomes a convenient way to act tough on trade in some ways.

33% of steel is imported.
https://www.trade.gov/steel/countries/pdfs/imports-us.pdf

90% of aluminum is imported.
https://www.reuters.com/article/usa-trade-steel-aluminium-ahome/column-which-sledgehammer-will-trump-use-on-u-s-aluminium-imports-andy-home-idUSL8N1QA3W1

Canada is the #1 exporter of steel and aluminum. Maybe he is trying to use tariffs as a leverage in NAFTA negotiations.

LOL, if 90% of the Aluminum is imported, it’s too lat to do tariffs,the trade war is already lost and the only thing tariffs so is to make it more expensive for consumers (car industry etc) and cause retaliation.

Dumbest idea ever, IMO. We had steel tariffs against certain producers (EU, China, Japan) on and off since the 1980‘s.
To be a realist, one has to believe in miracles.


Cigarbutt

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Re: Mr. Trump to Impose Stiff Tariffs on Steel and Aluminum
« Reply #11 on: March 01, 2018, 04:35:56 PM »
BTW, Mr. Linciome's landmark paper was referenced to elsewhere before on this Board, in a thread that discussed US-China protectionism.
Here it is again:
https://assets.realclear.com/files/2017/08/662_pa819.pdf
In that paper, the historical effects of the steel industry tariffs are well covered.
For those who want to dig further:
http://www.tradepartnership.com/pdf_files/2002jobstudy.pdf

Anyways, the key aspects of tariffs are not the immediate effects but the second-order effects and the unintended consequences.
If this is part of a very shrewd and focused plan to help restore balance in some specific areas or even if this is simply to "protect" some industries of related party (national?) interests, then OK.
However, the slippery slope involves the possibility of retaliation. After a while, who remembers who started first?

If we are on our way to a retaliation spiral, then the following may be helpful:
https://www.clubforgrowth.org/assets/files/smooth%20hawley%20ny%20times%2005%2005%2030.pdf

I'm not saying that we are in a 1928 style re-play, and who cares about economists. But maybe they had a point. Just wondering if we are much wiser today.

There are imbalances but it seems to me that the downward curve of the ratio of duties collected to dutiable imports that is characteristic of the last 70 years has a strong inverse correlation to our global quality of life even if it may not feel like it.
https://www.marketwatch.com/story/may-not-feel-like-it-but-the-worlds-improving-really-and-heres-the-proof-2018-03-01

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rb

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Re: Mr. Trump to Impose Stiff Tariffs on Steel and Aluminum
« Reply #12 on: March 01, 2018, 06:29:34 PM »
John, as others have said what this means will depend on the details of the actual order. But the basics are these:

The US just increased the price they pay for steel by 25% and the price they pay for aluminium by 10%. This will mean that the price will rise for a whole host of products - steel and aluminium go into lots and lots of things. This is fantastic news for US steel producers which just hit the jackpot and will turn in fantastic profits. There's not much aluminium production in the US so that's not so significant, but hey if you have a smelter then hey, great news.

If I was an American (that wasn't a steel worker) I would hate this. But as a Canadian I'm not so worried about it despite the fact that Canada is the largest exporter of steel and aluminium to the US. This action is likely to give a huge advantage to Canadian auto and machinery manufacturing as well as other heavy industries.

RadMan24

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Re: Mr. Trump to Impose Stiff Tariffs on Steel and Aluminum
« Reply #13 on: March 01, 2018, 07:07:43 PM »
I wouldn't be so sure. If US Steel prices for HRC is $800, then non-US sourced steel would have to be sold around $630 including shipping. Chinese steel ex works for export at around around $600 a ton for HRC, and has been in the $500s per ton for some time now. CRC has a similar margin difference compared to US steel prices.

If US Steel prices retain there current price levels, or go up, global producers could easily make a healthy margin in the $600 per ton range, and even lower price to boost share.

China is the top dog, however. All because their imports to US don't show up on a graph, they cause huge global fluctuations in price because of their huge impact on both the demand and supply side of the market. They flood other countries with steel, lowering the price. Look at a steel price chart over past 15 years, its bonkers.

I do not know how it will play out for aluminum, but it will surely be interesting how it affects steel prices on a global scale.

The market clearly thinks that US Steel producers are going to benefit greatly (despite having sub par operations) and auto's are going to suffer (despite having strong sourcing abilities). Further, this could also make investments into lowering the cost to produce carbon fiber and other materials that much more promising.

EliG

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Re: Mr. Trump to Impose Stiff Tariffs on Steel and Aluminum
« Reply #14 on: March 01, 2018, 07:45:39 PM »
Scott Lincicome again:

https://twitter.com/scottlincicome/status/969381291287306240

Quote
Interesting how many "people" with, like, 200 tweets, no avi, and a bunch of numbers in their @ handle have entered my TL today to defend tariffs & trade wars

If you were Vlad Putin and you wanted to undermine world trade order, what would you differently?

Sharad

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Re: Mr. Trump to Impose Stiff Tariffs on Steel and Aluminum
« Reply #15 on: March 01, 2018, 08:46:37 PM »
Scott Lincicome again:

https://twitter.com/scottlincicome/status/969381291287306240

Quote
Interesting how many "people" with, like, 200 tweets, no avi, and a bunch of numbers in their @ handle have entered my TL today to defend tariffs & trade wars

If you were Vlad Putin and you wanted to undermine world trade order, what would you differently?


Step 1, create handles with no numbers. 😎
"If we are not able to ask skeptical questions, to interrogate those who tell us that something is true, to be skeptical of those in authority, then we are up for grabs for the next charlatan - political or religious - who comes ambling along."
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EliG

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Re: Mr. Trump to Impose Stiff Tariffs on Steel and Aluminum
« Reply #16 on: March 01, 2018, 08:51:29 PM »
Step 1, create handles with no numbers. 😎

That's funny, thanks for the laugh.

My question wasn't about Russian bots attacking Mr. Lincicome. It was in reference to Trump's policy.

rb

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Re: Mr. Trump to Impose Stiff Tariffs on Steel and Aluminum
« Reply #17 on: March 01, 2018, 10:21:44 PM »
Step 1, create handles with no numbers. 😎

That's funny, thanks for the laugh.

My question wasn't about Russian bots attacking Mr. Lincicome. It was in reference to Trump's policy.
Yep! Pretty funny. Also a testament that the intelligence of the human race has perhaps been exaggerated.

rkbabang

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Re: Mr. Trump to Impose Stiff Tariffs on Steel and Aluminum
« Reply #18 on: March 02, 2018, 03:18:02 AM »
I heard Trump talking about this, he really can be ain ignorant moron sometimes.  He says they are “dumping” cheap steal on us. Damn I hate it when someone gives me a bargain on something I wish to buy. Just “dumping” inexpensive items on me.  It must piss people off when Walmart dumps cheap products on them at a good price which others can’t match.  Oh wait that does bother people, which is why people fight just about every planned Walmart coming into their community.  The difference is that it used to be only the left who didn’t understand economics.  I think he should next put a huge tariff on bananas to encourage US farmers to build huge greenhouses to produce them here.  Think of the US jobs that would create. Coffee too, all that cheap coffee from overseas and Kona being so expensive, it just isn’t fair that Columbia can just dump coffee on us.

Someone mentioned above that it will have a small impact on the economy, but not if you are in the building profession.  I wonder if this will put a damper on the skyscraper boom in NYC?

John Hjorth

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Re: Mr. Trump to Impose Stiff Tariffs on Steel and Aluminum
« Reply #19 on: March 02, 2018, 03:52:35 AM »
That's hilarious, rkbabang! Thanks to all for comments and links to good stuff about this to read in the weekend.

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