The US and EU remain in close negotiations regarding the future of Section 232 steel and aluminum duties placed by the US on imports from the EU and elsewhere. Both sides have “confirmed readiness to find a solution by Nov. 1” after a July 29 meeting between US Commerce Secretary Gina Raimondo and European Commission Trade Commissioner Valdis Dombrovskis, Politico reported.
Other tariff packages imposed by the Trump administration have either been abandoned – as in the case of four Section 232 tariff packages, discussed in Panjiva’s research of Aug. 5 – or under negotiation with US allies.
Matters will be complicated by the EU’s rollout of its “Fit for 55” program and its associated Carbon Border Adjustment Mechanism, which will target the steel and aluminum sectors in its first phase. Similar legislation in the US seems unlikely to get underway in the near term.
The EU may be keen to increase shipments, given EU steel exporters have been losing ground to suppliers in Mexico and Canada following the latter’s exemption from tariffs as part of the United States-Mexico-Canada Agreement. Panjiva data shows total U.S. imports of steel and aluminum covered by the tariffs increased 15.3% in the second quarter of 2021 versus the second quarter of 2019. Shipments from the USMCA member countries surged 84.7%, while those from the EU fell 17.0%.
Panjiva data shows US seaborne imports of steel and aluminum products from the EU increased 28.3% year over year in July, led by a 113.3% surge in shipments linked to thyssenkrupp AG and a 48.3% rise in shipments associated with SSAB AB. While potentially reflecting a preparedness for reduced tariffs, it is also worth noting that both total shipments and those linked to most companies are still below their 2019 levels.
— Eric Oak, Panjiva Research, S&P Global Market Intelligence
