The White House issued a proclamation on January 24 widening tariffs on the imports of derivative aluminum and steel products into the U.S., citing increased import volumes in an effort to circumvent the duties on aluminum and steel articles. Derivative aluminum products will be subject to a 10% tariff and derivative steel products will be subject to a 25% tariff in addition to any other duties the products are already subject to.
This proclamation applies to any derivative products entered for consumption or withdrawn from warehouse for consumption on or after 12:01 a.m. ET on February 8, 2020. Derivative products are described as being, on average, two-thirds or more of the total cost of materials of the derivative article. This includes steel nails, tacks, drawing pins, corrugated nails, staples, aluminum stranded wire, cables, plaited bands, slings and similar products.
Argentina, Australia, Canada and Mexico are exempt from the derivative aluminum tariffs and Argentina, Australia, Brazil, Canada, Mexico and South Korea are exempt from the derivative steel tariffs.
The Administration is using Section 232 of the Trade Expansion Act to impose the tariffs, which he also used for the original metal tariffs imposed in March 2018. It’s a law passed in 1962 that allows tariffs to be imposed by the president when imports are deemed to be damaging to U.S. national security.