MEDFORD, Ore -- Local steel and aluminum manufacturers are facing uncertain futures after new tariffs that were signed into law yesterday.
Paul Contreras, Branch Manager for Farwest Steel in Medford says that their customers use their steel for a multitude of products, “fabricators, custom builders, those kind of things, and we just want to make sure that we can have the right metal for them when they need it.”
On March 8th President Trump imposed a 25% tariff on steel imports and a 10% tariff on aluminum imports. Right now, only Canada and Mexico are exempt from the added taxes but other countries can apply for an exemption.
President Trump explained, "America will remain open to modifying or removing the tariffs for individual nations as long as we can agree on a way to ensure that their products no longer threaten our security.”
The tariffs will take effect on March 22nd.
According to a CNN report, a tariff is a tax or duty that the government places on a class of imported goods. In theory, this makes the foreign products more expensive — boosting domestic makers of the product, which don't have to pay the tax. The tariff is collected by customs officials and goes to the government.
The overall goal is to boost local manufacturing by making the price imported goods more expensive. However, there are concerns that the steel and aluminum industry in America isn’t large enough to meet demands, which could lead to shortages.
The tariffs would impact the cost of raw materials for vehicles, baseball bats, aluminum cans, and other products that rely on steel and aluminum.
The tariffs also hit on a separate fear of a trade war with countries that are not exempt.
On Friday China’s Commerce Ministry official Wang Hejun stated that Beijing will take “firm actions” if the tariffs inflict losses on Chinese businesses. According to data from S&P Global Platts a small amount of the 2% of imported steel that came into the U.S. last year was from China.
South Korea is the third largest exporter of steel to the US according to S&P Global Platts, officials stated that Seoul will "actively respond" to the tariffs but didn't specify whether it would take any retaliatory action against US goods.
Japan said it would study the move's impact on Japanese companies before responding further.
The European Union said it could respond with their own tariffs for American products which would include oranges, bourbon, denim, cranberries, peanut butter and motorcycles.
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