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Taxes on Steel went into effect the first week of June, and the repercussions of that decision have arrived. Roughly 400,000 jobs are forecast to be lost compared to the 26,000 that were expected to be created from the metal tariffs.
The Commerce Department granted seven companies a total of 42 exclusion requests yet denied 56 applications from 11 other companies. The basis for approval or denial is if there is no domestic availability and no overriding national security concerns concerning the specific product.
The largest nail manufacturer in the United States, located in Missouri, has recently laid off 60 of it 500 workers last week in response to the increased steel costs. Primarily, the company blames the 25% on imported steel and orders plummeted 50% after the company raised its prices to compensate for the higher steel costs.
Mid-Continental Steel and Wire applied to be exempt from paying the tariff, but unless something is done soon by the commerce department, they are looking to be shut down by Labor Day. There is talk about the company possibly relocating to Mexico to buy the steel without tariffs and export back to the U.S. without taxes. However, they aim to avoid this move to save the jobs in Missouri currently held at the plant.
Joel Johnson is the CEO of Borusan Mannesmann Pipe U.S., a company that manufactures welded pipe used by energy companies to pull oil and natural gas out of the Earth. He is fighting to keep this pipe factory above ground just east of Houston and out of reach from Trump’s grasp.
His company is among the 20,000 that have submitted a request for exemption from the tariffs. Johnson applied for a 2-year exemption from Trump’s tariffs, but that is proving to be an uphill battle. Without his application approval, Johnson could be facing levies of up to $30 million a year, crushing his hopes of expanding the business in the future.
At A1 Worldwide Logistics, we’re always keeping tabs on what’s changing in the industry. We’ve kept our business at the top of the logistics world because we’ve weathered through storms locally and internationally. Minimize the worry and stress on shipping and strengthen the logistics for your business by contacting us today at (305) 821 – 8995.
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