The Commerce Department is urging President Donald Trump to impose tariffs or quotas on imported aluminum and steel, which it calls a natural security threat. Although Trump campaigned on a protectionist platform, he has taken only modest action so far to restrict imports.
Companies can also seek appeals based on USA production of steel and aluminum and specific national security-based considerations.
Trump has talked a lot about trade and with this decision, NAFTA and others, we will soon find out of he's going to act.
On Friday, Ross said: "In each case, the imports threaten to impair our national security".
- A quota on all steel products from all countries equal to 63% of a country's 2017 exports to the US. In the early afternoon, shares of United States Steel Corp. were up 10 percent, shares of AK Steel Holding Corp. were up more than 11 percent and shares of Century Aluminum Co. were up almost 7 percent. The president is being asked to consider a 7.7 per cent tariff on all aluminum exports from all countries, or a 23.6 per cent tariff on just a few countries: China, Hong Kong, Russia, Venezuela and Vietnam.
On an average month, China produces almost as much steel as the US does in a year. Their excess capacity alone exceeds the total US steel-making capacity.
"As they dump steel, they pay tariffs - substantial tariffs - which means the United States would actually make a lot of money, and probably steel industry and aluminum industry would come back into our country".
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On Wall Street, investors reacted by buying the stock of companies that make steel and aluminum.
The Commerce Department is recommending steep tariffs on foreign steel and aluminum.
The Alliance for American Manufacturing, which represents American steel manufacturers and the steelworkers union, cheered the recommendations. The president must choose a course of action by April.
Since the United States joined the World Trade Organization in 1995, it has only pursued two such investigations.
One of the witnesses who contributed testimony was a Canadian - who happens to be a key player in the USA steel industry, and a longtime associate of Ross's: the Ontario-born president of the United Steelworkers union, Leo Gerard.
Cowen and Co. analysts Novid Rassouli and Han Zhang told clients in a research note they believe Trump will likely go for more targeted options. China is by far the largest producer and exporter of steel, and the largest source of excess steel capacity. "(But) the blanket-tariff alternative and the blanket-quota alternative would target all countries.
"If these tariffs are imposed, the USA will become an island of high steel prices resulting in our customers simply importing the finished part and threatening thousands of jobs", the groups said. "It'll make a decision, and I will make a decision that reflects the best interests of the United States, including the need to address overproduction in China and other countries".