Aluminum smelter resurrected on Trump tariffs may close as losses mount

MARSTON, Missouri, (Reuters) - A bankrupt aluminum smelter that re-opened in 2018, after U.S. President Donald Trump imposed tariffs on imported metals, is losing money at such a rapid clip that it could close within 60 days, the top executive at the Missouri plant said on Thursday.

Trump’s trade policies protect the generic aluminum product made by Magnitude 7 Metals LLC, a 50-year-old smelter on the banks of the Mississippi in southeastern Missouri. But the tariffs often do not cover the value-added aluminum products being shipped to the United States by foreign competitors, undercutting the company’s position.

“The rest of the world has gamed the tariffs, in our opinion,” Magnitude 7 Metals chief executive Charles Reali told Reuters in an interview. “The Commerce Department tried to help, but missed the mark.”

The grim outlook for Magnitude 7 has been exacerbated by the coronavirus, which is reverberating around the globe while raising fears of a global recession. On Friday, the London Metal Exchange (LME) aluminum price fell to $1,676 per ton, the lowest since October 2016.

“We are in prayer” mode, Reali said. “If things don’t turn around in the next 60 days, I don’t know.”

Magnitude 7 Metals opened to great fanfare about two years ago in a ceremony attended by then Missouri Governor Eric Greitens. Trump’s 10% tariffs on imported aluminum helped restore more than 400 jobs in New Madrid County, where nearly a quarter of the population lives in poverty. The plant shut down in 2016 when the previous owner, Noranda Aluminum, filed for bankruptcy.