US to officially act on tariffs against Brazilian and Argentine steel

U.S. President Donald Trump's announcement that the U.S. will begin enforcing Section 232 tariffs on steel and aluminum imports from Brazil and Argentina has not been officially announced by the White House.

Trump said the tariffs were to take effect immediately; however, for the president to change the quotas or tariffs set, it would require the publication of a presidential declaration, but as of Thursday afternoon the White House had not issued anything. The White House did not respond to requests for comment.

The Trump administration imposed a general 25% tariff on all steel imports and 10% on all aluminum imports in March 2018 in accordance with section 232 of the law, arguing that these imports pose a security threat to the US economy. In June 2018, restrictions on Brazil and Argentine steel and aluminum were converted to a quota system.

Another blurring of the prospects for tariff increases is the recent ruling by the US Court of International Trade. A November 15 ruling rejected a US government motion to dismiss a case challenging Trump's August 2018 decision to double the steel tariff in Turkey from 25% to 50% under section 232.

The US maintains that the president reserves the right to change any action taken under section 232 at any time, but the court noted that there is a time limit under section 232 statute within which these decisions must be issued. Under section 232, the president has 90 days to decide tariffs after receiving the 232 report from Congress, and an additional 15 days to take any trade action. Section 232 commercial reports on steel and aluminum were submitted to Trump in early 2018.

Uncertainty around tariffs, especially with regard to supplies from Brazil, is closely monitored by steel market participants, especially in the US flat products market.

“Brazil sells about 4 million tons of slabs annually in the US market without any tariffs,” the trader said. “Brazilian slab prices are critical as US factories can keep their product prices downstream and they almost serve as a pricing guide for other slab importers. Rising import prices for slabs are likely to lead to higher prices for US plate. ”

At an industry event last week, tariffs for Brazil were a hot topic, as attendees said there are currently ships on the water delivering slab from Brazil, and large orders have already been placed for February and March that could eventually be canceled. if the tariffs come into effect.

“Brazilian slabs were the cheapest on the market, and any factory would