Biden may triple tariffs on Chinese steel, aluminum
WASHINGTON – President Joe Biden threatened to triple the rates of tariffs on steel and aluminum from China amid pressure from labor unions concerned about the survival of the U.S. steel industry as Chinese exports flood the global markets.
Biden, during an address Wednesday to leaders of the United Steelworkers union in Pittsburgh, called on United States Trade Representative Katherine Tai to consider tripling the existing 7.5% average tariff rate on Chinese steel and aluminum to 25% under Section 301 of the Trade Expansion Act.
“They’re not competing − they’re cheating. And we’ve seen the damage here in America,” Biden said of China, adding that Pennsylvania and Ohio lost 14,000 steel jobs between 2000 and 2010 when China first began flooding the markets. “Let me ask you: Are we going to let that happen again?”
“No!” steelworkers at the union’s headquarters shouted in response.
China − which produces more than half the world’s steel − is making more steel than the world can absorb,
“flooding global markets at artificially low prices” and “undercutting American steel that is clean,” said Lael Brainard, director of the White House’s National Economic Council.
Production of Chinese steel isn’t subject to the same level of environmental regulation that the U.S. requires domestically, and the price of Chinese steel exports is about 40% lower than the price of U.S. exports.
The higher tariffs would apply to Chinese steel and aluminum imports that aren’t subject to a Trump-era 25% tariff still in place on certain steel imports under Section 232 of the Trade Expansion Act.
It is unclear when the higher Chinese steel tariffs would go into effect. U.S. tariffs imposed under Section 301 are nearing the conclusion of a statutory fouryear review. Any formal action would follow the review.
In a related move, Biden is also directing the White House to work with Mexico to stop China’s “evasion of tariffs” on steel and aluminum that are imported from Mexico to the U.S.
The United States Trade Representative will conduct an investigation into China’s trade practices in shipbuilding following a petition by United Steelworkers alleging that China is pursuing aggressive nonmarket policies that have allowed it to dominate the global market.
“If that investigation confirms these anti-competitive trade practices, then I’m calling on (Tai) to consider tripling the tariff rates for both steel and aluminum imports from China,” Biden said.
Imports of steel from China account for only about 0.6% of total U.S. steel demand, according to a senior Biden administration official. As a result, the White House does not believe raising the steel tariffs risks further increasing inflation.
The U.S. steel industry has been rattled by the planned $14.9 billion sale of Pittsburgh-based U.S. Steel − an iconic American brand for more than a century − to Japan-based Nippon Steel Corp.
Biden last month came out in opposition to the sale, which is under review by the Committee on Foreign Investment in the United States. The United Steelworkers union, which opposes the deal, endorsed Biden’s reelection bid shortly after he announced his opposition.