In a February article, Engineering News-Record spoke with Ken Simonson, AGC's chief economist, and Anirban Basu, chief economist with Associated Builders and Contractors to get their opinions on how a proposed steel and aluminum tariffs might affect the construction industry.
Since ENR's story ran, the Commerce Department has recommended President Trump impose an immediate tariff on imported steel based on its report The Effect of Imports of Steel On the National Security, giving him three options:
- A global tariff of at least 24% on all steel imports from all countries, or
- A tariff of at least 53% on all steel imports from 12 countries (Brazil, China, Costa Rica, Egypt, India, Malaysia, Republic of Korea, Russia, South Africa, Thailand, Turkey and Vietnam) with a quota by product on steel imports from all other countries equal to 100% of their 2017 exports to the United States, or
- A quota on all steel products from all countries equal to 63% of each country’s 2017 exports to the United States.
Commerce Secretary Ross says these options would increase domestic steel production about 7 percent, raising U.S. capacity to around 80 percent of operating rate.
Commerce has also recommended aluminum imports be subject to several tariff options based on its report The Effect Of Imports Of Aluminum On The National Security:
- A tariff of at least 7.7% on all aluminum exports from all countries, or
- A tariff of 23.6% on all products from China, Hong Kong, Russia, Venezuela and Vietnam. All the other countries would be subject to quotas equal to 100% of their 2017 exports to the United States, or
- A quota on all imports from all countries equal to a maximum of 86.7% of their 2017 exports to the United States.
Commerce says each of the three aluminum proposals would raise domestic aluminum production to 80 percent capacity.
The President is required to make a decision on the steel recommendations by April 11, 2018, and on the aluminum recommendations by April 19, 2018.
Both Simonson and Basu suggest contractors will take an economic hit. Read what they had to say in ENR's Proposed U.S. Tariffs Would Hike Construction Steel Prices, Economists Say, originally posted February 22.