But Panjiva lead researcher Christopher Rogers interprets the new rules as bringing greater transparency to aluminum supply chains at the cost of increasing complexity. The new rules add to the process for requesting exclusions for businesses and individual products.
To date, approximately 27,571 requests have been made, according to the Congress Research Service, of which 61% were approved.
Rogers expects further complications if the Biden administration limits the number of countries subject to tariffs or quotas.
“Canada and Mexico have already been exempted as part of the completion of the US-Mexico-Canada agreement. The Trump administration has also exempted shipments from the United Arab Emirates and Australia from tariffs, while Argentina is subject to a quota. Imports from the EU and UK may also qualify for exemptions depending on the outcome of ongoing discussions, ”the analyst said in a May 26 bulletin.
Panjiva data shows U.S. imports of Section 232-covered aluminum products increased 5.2% year-over-year in the first quarter, likely due to higher prices and the initial slowdown associated with the pandemic. Imports were 10.8% lower than in the same period of 2017 before the introduction of tariffs.
Section 232 authorizes tariffs on goods deemed important to the national security of the United States.
Rogers noted that shipments from Canada and Mexico were now above their pre-pandemic and pre-tariff levels, growing 2.2% in the first quarter of 2021 compared to the first quarter of 2017.
“Imports from other exempt countries are still lower than before. The outlier was imports from the EU and the UK, which, although 6.1% lower than a year ago, are above their 2017 levels, which were unusually low at the time, ”Rogers said.
Unsurprisingly, imports from countries without exemptions outside the EU and the UK did worse than average. They were down 0.7% year-on-year in the March quarter, masking a decline of 31.5% from 2019 and 26.8% from 2017.
However, US seaborne imports from these non-exempt countries by most major importers are still in a declining state of shipments. For example, Aluminum Bahrain BSC-related shipments decreased 20% year-on-year and 44.6% less than in 2019.
Deliveries associated with Kaiser Aluminum Corp. were down 10.4% year-over-year, but improved from 2019. Hindalco Industries, meanwhile, started declining in April with a 19.2% drop, which could s ‘worsen depending on the impact of the rapidly spreading pandemic in India.
Last year, the U.S. Trade Representative flip-flopped to reimpose tariffs on Canadian-made aluminum products just hours before Canada introduced dollar-for-dollar countermeasures to the tune. $ 2.7 billion (C $ 3.6 billion) on US-made aluminum products.
Meanwhile, the US-based Aluminum Association hosted on May 17 a common commitment by the United States and the EU to combat overcapacity in the global aluminum market.
“This is an extremely important step towards a better business relationship with a vital ally while tackling systemic aluminum overcapacity,” said CEO Tom Dobbs in a Press release.
The association argues that massive state subsidies for aluminum production – especially in China – have distorted markets and made it difficult for many aluminum producers to compete on a level playing field for too long.
“It is time for nations committed to a rules-based, market-based global trading system to come together to tackle this common challenge. Any final deal with Europe should focus on strict trade enforcement based on a common set of rules, ”Dobbs said.
A recent report Organization for Economic Co-operation and Development found that three years of section 232 tariffs had done little to change Chinese industrial practices.