New Steel and Aluminum Derivatives Tariffs!

It took less than two weeks from the date President Trump signed a Phase One deal with China for more tariffs to surface! On January 15th, 2020, Presidents Trump and Xi Jinping met in DC and signed the official Phase One trade deal. That move is the first positive step in de-escalating the ever-growing tariff war between the US and China.

However, less than two weeks later President Trump has come on with additional tariffs. This time, not directly targeting China, but the move will impact China as well as other major manufacturing countries worldwide. As a follow up to the section 232 Steel and Aluminum tariffs, imposed in 2018 targeting many raw forms and variants of Steel (25%) and Aluminum (10%), the President made a proclamation aimed at additional items.

The new 232 tariffs will apply to many “derivative” items of steel and aluminum. The reasoning? Apparently when you levy taxes on raw materials, companies will determine whether they should buy finished goods instead, as opposed to trying to locate all manufacturing stateside. With no surprise, most companies found that this was exactly the best financial option. Thus, for the past 1.5 years or so, the importation of more finished items, derived or composed primarily of steel or aluminum have sharply increased.

This proclamation features two Annexes and is said to go into effective as of February 8, 2020. For more, you may review the proclamation here: https://www.whitehouse.gov/presidential-actions/proclamation-adjusting-imports-derivative-aluminum-articles-derivative-steel-articles-united-states/

The Annexes are not readily available, here are summaries of items currently listed on those documents:

Aluminum:

(A) stranded wire, cables, plaited bands and the like, including slings and similar articles, of aluminum and with steel core, not electrically insulated; the foregoing fitted with fittings or made up into articles (described in subheading 7614.10.50);

(B) stranded wire, cables, plaited bands and the like, including slings and similar articles, of aluminum and not with steel core, not electrically insulated; the foregoing comprising electrical conductors, not fitted with fittings or made up into articles (described in subheading 7614.90.20);

(C) stranded wire, cables, plaited bands and the like, including slings and similar articles, of aluminum and not with steel core, not electrically insulated; the foregoing not comprising electrical conductors, not fitted with fittings or made up into articles (described in subheading 7614.90.40);

(D) stranded wire, cables, plaited bands and the like, including slings and similar articles, of aluminum and not with steel core, not electrically insulated; the foregoing fitted with fittings or made up into articles (described in subheading 7614.90.50);

(E) bumper stampings of aluminum, the foregoing comprising parts and accessories of the motor vehicles of headings 8701 and 8705 (described in subheading 8708.10.30) and

(F) body stampings of aluminum, for tractors suitable for agricultural use (described in subheading 8708.10.30)

Steel:

(A) nails, tacks (other than thumb tacks), drawing pins, corrugated nails, staples (other than those of heading 8305) and similar articles, of iron or steel, whether or not with heads of other material (excluding such articles with heads of copper), suitable for use in powder-actuated handtools, threaded (described in subheading 7317.00.30); and

(B) nails, tacks (other than thumb tacks), drawing pins, corrugated nails, staples (other than those of heading 8305) and similar articles, of iron or steel, whether or not with heads of other material (excluding such articles with heads of copper), of one piece construction, whether or not made of round wire; the foregoing described in statistical reporting numbers 7317.00.5503, 7317.00.5505, 7317.00.5507, 7317.00.5560, 7317.00.5580 or 7317.00.6560 only and not in other statistical reporting numbers of subheadings 7317.00.55 and 7317.00.65;

(C) bumper stampings of steel, the foregoing comprising parts and accessories of the motor vehicles of headings 8701 to 8705 (described in subheading 8708.10.30); and

(D) body stampings of steel, for tractors suitable for agricultural use (described in subheading 8708.29.21).