Feds propose steel quotas, tariffs of at least 24 percent on all imports

A worker watches the loading of steel plate products at Posco steel mill in Pohan, South Korea, in 2011. The U.S. Department of Commerce is proposing tariffs of at least 24 percent on all steel imports.

The U.S. Department of Commerce recommended quotas on steel imports and tariffs as part of its long-awaited Section 232 Report. That could help preserve high-paying steelworker jobs in Northwest Indiana.

U.S. Commerce Secretary Wilbur Ross, who helped salvaged Northwest Indiana steel mills from bankruptcy more than a decade ago, released a report that recommended baseline tariffs of 24 percent on any foreign-made steel and targeted tariffs of 53 percent on imports from Brazil, China, Costa Rica, Egypt, India, Malaysia, South Korea, Russia, South Africa, Thailand, Turkey and Vietnam.

The federal agency also recommended quotas that would limit steel imports to 100 percent of what was imported last year by product type, and to 62 percent of each country's 2017 exports to the United States.

“We applaud the release of the findings and recommendations contained in the Section 232 Report," Steel Manufacturers Association President Philip Bell said. "Secretary Ross has accurately concluded that steel imports threaten to impair our national security from both a defense and critical industry standpoint. The secretary has laid out options that have the potential to be meaningful and effective to address the threat the industry faces in light of global excess capacity and relentless steel imports.”

President Donald Trump must decide on whether to move forward on protections for the American steel industry, a frequent promise he made on the campaign trail. 

“The president now has options before him that can move our industry forward and help steelmakers operate at rates that will allow U.S. producers to reinvest to maintain and strengthen the industry to ensure U.S. steel production can survive to serve U.S. national defense interests," Bell said. “The release of the report represents an important increase in transparency in this national security process and we will continue to analyze its findings. We look forward to a decision by the President, and working with the steel industry, Congress and interests on all sides of this vital issue.”

The Section 232 report into whether steel dumping harms national security found the United States imports more steel than any other country. Employment in the steel industry has fallen 35 percent since 1998, and at least 10 blast furnaces have closed since 2000.

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"Trump is one step away from taking historic action to defend American jobs and security," Alliance for American Manufacturing President Scott Paul said. "We believe the action must be broad, robust and comprehensive, and the Commerce Department report makes a compelling case for immediate action. Any exclusions deserve appropriate scrutiny. Otherwise, the Washington swamp will be filled with importers trying to undermine American jobs. American workers are counting on President Trump to stand up for them.”

Buyers of steel expressed disappointment with the Section 232 report, fearing it could drive up prices.

“How are our manufacturers expected to compete globally when our government taxes our most significant input?" said Miles Free, director of Industry Research and Technology at The Precision Machined Products Association. "Acting on these recommendations will simply lead to the importation of more finished precision metal products from foreign companies that come in with overseas steel and aluminum, all duty free."

Local elected officials, including U.S. Rep. Pete Visclosky, D-Gary, and U.S. Sen. Todd Young, R-Indiana, have lobbied on behalf of the steel industry, which employs an estimated 24,000 workers in Indiana.

At a White House meeting last week, Young told administration officials that Indiana industries include major steel producers and users.

“Clearly, you understand the need to balance the two, to come up with a balanced approach here,” Young told Trump during the meeting, according to a press release. “I think the main target — and I'll just speak plainly with you, sir — should be China. They're violating the international rules, stealing our intellectual property, and overproducing steel products and other products.”


Business Reporter

Joseph S. Pete is a Lisagor Award-winning business reporter who covers steel, industry, unions, the ports, retail, banking and more. The Indiana University grad has been with The Times since 2013 and blogs about craft beer, culture and the military.