Business Forward tracks a host of trade issues including the North American Free Trade agreement and its pending replacement. In its latest report in October U.S. manufacturers in highly competitive markets and those manufacturers that export their finished goods may be impacted disproportionally by price differences on steel over the next seven months.
While some U.S. iron and steel manufacturers and the United Steelworkers support the tariffs because they slow the illegal dumping of underpriced steel into the U.S., others that buy steel to make their products complain that tariffs have raised their costs considerably and interfered with their supply chains.
According to the report, U.S. made hot-rolled and cold-rolled steel prices rose 13.5 and 8.9 percent respectively in seven months, while prices in the U.K., Italy, China, Germany, and Japan dropped resulting in U.S. steel manufactures being 15.8 percent more.
Jim Doyle, President of Business Forward, said, ”Companies that buy steel employ 46 times more workers across the United States than companies that produce steel,” and thus tariffs could cost jobs.
However, 12,000 workers in steel and aluminum industries have been hired or recalled since February, said Tony Montana for the United Steel Workers Union.
“I don’t trust anything touted by free-trade lobbyists as ‘proof’the tariffs aren’t working, ”he said. “These jobs in primary metals support five other jobs upstream and downstream in the industrial supply chain as well as in their immediate communities.”
Montana also said, generally U.S. steelmakers and workers supported President Trump when he pushed through the trade tariffs on imported steel and aluminum in March.
Initially suggested for China, they have since included goods from U.S. allies, causing retaliatory tariffs and renewed trade talks.
The American Iron and Steel Institute reported the tariffs slowed down steel imports but at the same time, it became a double whammy for other U.S. manufacturers that rely on imported steel.
When metal prices rose, metal suppliers became choosy as which customers they would supply leaving some manufacturers at the bottom of the list when trying to order steel.
Minnesota’s multinational manufacturers said their supply costs have heavily increased.
Some Minnesota based companies, like 3M, Polaris Industries and NVent Electric PLC said they will be paying out millions in tariff related costs this year and next.
Trade groups such as the National Association of Manufacturers urged the Trump administration to restore bilateral trade talks with China and other partners to find a new solution.