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Duty Increase To Aluminum And Steel Imports Into The U.S. Effective June 1, 2018

By Pacific Customs Brokers, Pacific Customs Brokers May 31, 2018

News update: (January 31, 2020) On January 24th, 2020, President Trump expanded Presidential Proclamations 9704 and 9705, which cover articles of aluminum and steel, to include certain derivative articles. The expansion to derivative articles will become effective on February 8th, 2020.

The Secretary of Commerce was tasked with monitoring the steel and aluminum industries to ensure that they were achieving the growth expected as a result of the additional duty on foreign imports. The secretary found that the growth was not as expected and reviewed the imports of derivative articles as a possible cause.

The Secretary of Commerce advised the President that there has been an increase in imports of derivative articles of steel and aluminum which is undermining the purpose of the additional duties.

Over the past two years, there has been a dip in imports of the articles originally affected by the additional duties. However, the secretary reports that there has been a surge in derivative articles over the same time period when compared to the two years preceding the establishment of additional duties.

The articles included in the secretary’s report include:

  • Steel nails, tacks, drawing pins, corrugated nails,
  • Steel staples and similar derivative articles
  • Aluminum stranded wire, cables, 
  • Aluminum plaited bands and the like including slings and similar derivative articles.b
  • Bumper and body stampings of aluminum and steel for motor vehicles and tractors.

As a result of the surge in imports, which the President viewed as an attempt to undermine the original order, he has expanded the scope of the duties to include the items listed above.

The goods described in the update to this proclamation apply to all countries EXCEPT goods manufactured in Argentina, Australia, Brazil, Canada, Mexico or South Korea.


News update: Effective June 1, 2018, the White House released information indicating that there would be no further extensions for exemptions from Proclamations 9704 and 9705, for imports of goods manufactured in the countries as listed for each proclamation.

Proclamation 9704 - Brazil, Canada, Mexico and the European Union (as well as all other countries not specifically excluded)

Proclamation 9705 - Australia, Canada, Mexico and the European Union (as well as all other countries not specifically excluded)

Background:

The United States Government is authorized under Section 232 of the Trade Expansion Act of 1962, to put in place safeguard tariffs to protect the national security of the United States.  President Trump has declared that the U.S. is in jeopardy of weakening or disappearance of domestic aluminum and steel production capabilities due to foreign imports, which is perceived as a threat to national security.

Using the authority vested in him through Section 232 of the trade act the President has issued proclamations 9704 and 9705, which will impose additional import tariffs on all imports of foreign goods within the scope of the proclamations.

Proclamation 9704, covers articles of Aluminum with an additional duty rate of 10%.

Items covered are under the following tariff numbers:

7601

7604

7605

7606

7607

7608

7609

7616.99.5160

7616.99.5170

Proclamation 9705, covers articles of Steel with an additional duty rate of 25%.

Items covered are under the following tariff numbers:

7206.10 through 7216.50

7216.99 through 7301.10

7301.10

7302.10

7302.40 through 7302.90

7304.10 through 7306.90

Importers need to be aware that the additional duties cannot be avoided through use of special programs such as free trade agreements.

The duty rates imposed under the proclamations are in addition to the normal duties applied to the affected tariff numbers. Free trade agreements are still valid to waive normal duties and MPF on goods that qualify.

NOTES:

As of June 1, 2018: STEEL: All countries of origin except Argentina, Brazil, and South Korea (these countries are exempt even after May 31)   

As of June 1, 2018: ALUMINUM: All countries of origin except Argentina and Australia.

Canada Retaliates With Dollar-for-Dollar Steel and Aluminum Tariffs Against U.S.

With the U.S. decision to impose an additional 10% duty rate on aluminum and 25% duty rate on steel, Canada has reciprocated with countermeasures in response to the American decision.

Canada’s tariffs are highlighted by steel and aluminum but will include other products as well. The tariffs will go into effect on July 1, 2018.