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Aluminum April 17, 2024 03:00:22 PM

Biden May Triple Tariffs on Chinese Steel and Aluminum

Paul Ploumis
ScrapMonster Author
The shipbuilding probe will be part of Biden's overall review of Trump's tariffs on some $300 billion worth of Chinese imports.

Biden May Triple Tariffs on Chinese Steel and Aluminum

SEATTLE (Scrap Monster): President Biden will use a visit to the United Steelworkers headquarters in Pittsburgh today to announce that his administration is considering tripling tariffs on Chinese steel and aluminum.

Why it matters: Biden is determined not to allow former President Trump to outflank him on who is tougher on China. He's also bent on winning Pennsylvania, a state he considers a second home.

So Biden will zero in on steel and shipbuilding as industries that need protection from cheaper Chinese imports.

"China's subsidies and other forms of support lead to exports flooding global markets at artificially low prices, undercutting American steel," National Economic Council Director Lael Brainard told reporters late Tuesday.

"China cannot export its way to recovery," she said.

Driving the news: Biden will direct Katherine Tai, the United States trade representative, to open an investigation into China's alleged subsidies for its shipbuilders. The probe was requested by five labor unions.

Steel and aluminum imports from China currently face 7.5% tariffs under Section 301 of Trade Act of 1974. Biden is directing Tai to consider raising them to 25%.

Between the lines: Biden isn't imposing new tariffs with the stroke of his pen.

But — like he did with the Committee on Foreign Investment in the United States' review of Nippon Steel's bid for U.S. Steel — he's giving a strong hint of where he wants Tai to eventually land.

The shipbuilding probe will be part of Biden's overall review of Trump's tariffs on some $300 billion worth of Chinese imports.

What we're watching: Biden has kept those tariffs on the books and is likely to extend them with a few modifications — including efforts to protect America's electric vehicle industry.

Increasing the steel and aluminum tariffs would be a highly symbolic way for Biden to claim that his Section 301 tariffs are more strategic than Trump's.

The other side: Trump also is talking tough on China and has floated tariffs of up to 60% on all imported Chinese products.

Go deeper: Biden has made a manufacturing renaissance one of the keystones of presidency, with a some $50 billion to bolster American's semiconductor industry and another $370 billion to boost the green energy and technology industries.

For several weeks, Biden officials have been warning about China's growth trajectory and putting Beijing on notice that it shouldn't try to export the excess capacity in its economy.

Treasury Secretary Janet Yellen used her trip to China this month to warn of the global risks stemming from China's excess capacity.

The fear is China will rattle the global economy by creating too many exports, disrupting U.S.-based industries in the process.

Courtesy: www.axios.com

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