Removing aluminum tariffs would be a win for the US economy and the climate

It’s no secret that former President Donald Trump’s imposition of Section 232 tariffs on steel and aluminum imports was unpopular in many circles, especially among industries. Americans who depend on these metals for production. Aluminum, slapped with 10% tariffs, saw its price jump from about $1,600 per ton to nearly $2,800 per ton. Tin, likewise, almost double of its price of $20,000 per ton.

Over the past few months, however, we have seen momentum building toward the cancellation of Section 232 tariffs on steel and aluminum imports. This is good news, but there is still a lot to do.

The first shoe was dropped last November, coinciding with the G20 and COP26 in Glasgow, Scotland, when US and EU officials announced phased relief for steel and aluminum trade. the OK exempted 3.3 million tons of steel, 18,000,000 metric tons for raw aluminum products and 366,000 metric tons for raw aluminum products.

EU President Ursula Von Der Leyen also announcement it would drop a new wave of tariffs that would take effect on December 1. U.S. Trade Representative Katherine Tai noted the agreement would help “turn the page on past disputes and open a new chapter of strengthened transatlantic relations”.

The second shoe dropped on January 19, when the US and UK announcement they would enter into bilateral talks to address global excess steel and aluminum capacity, including Section 232 tariffs. Full details on the focus of the talks have yet to be released, but it is hoped the two countries have in view a complete reduction of these tariffs. US officials are also working hand in hand with the Japanese to chart the course for steel and aluminum markets that encourage low-carbon production.

Section 232 tariffs are no small matter of trade policy, because eliminating them would be a victory not only for U.S. producers who rely on materials like steel, aluminum and tin, but also for the climate. This is because increased US participation in the global aluminum trade, in particular, move the world one step closer to low-carbon manufacturing technologies and ultimately the carbon neutrality of aluminum.

Currently, China’s dominance in aluminum production is a major climate challenge, as China’s aluminum smelters are said to be the 16th largest in the world. the biggest contributor to global carbon emissions if it were a nation.

Removing tariffs would help unleash low-carbon aluminum, which takes advantage of hydropower and uses advanced smelters, aluminum production could represent fewer carbon emissions that contribute to climate change. How nations produce commodities like aluminum matters, which is why it’s vital to completely eliminate Section 232 tariffs and create a level playing field for low- and low-cost products. zero carbon. Reducing trade barriers for non-Chinese aluminum would not only reduce China’s growing dominance in the global aluminum market, but also help reduce emissions.

In the long term, the United States needs a secure supply chain from various sources to meet domestic demand for aluminum use. Eliminating tariffs and creating more predictable markets can help us achieve this, because securing a diverse supply chain from reliable partners boosts economic activity and creates jobs.

The purpose of President Trump’s Section 232 tariff on steel and aluminum was in part to raise the price of imported aluminum to encourage domestic manufacturing; the data shows us so far this objective was not successful. Another objective was to fight against Chinese overcapacity and the illegal dumping of these products.

This continues to be a real problem, as Chinese aluminum production has grown from just 11% of global production in 2000 to more than half today. In the long term, the United States must find a way to strengthen its position on trade enforcement, neutralizing China’s subsidies and artificial incentives that distort the market in its favor.

However, the answer has never been trade protectionism. To fend off China and win on the climate, the real answer is to replace old commodity markets with new ones, ones focused on low- and zero-carbon production. Creating a free and open green corridor for low-carbon goods and services is not only a benefit for the United States and its key allies such as the EU, but also for the longevity of our planet. and for American consumers who will benefit from everyday products at a lower cost. .

Baron Hill served as the representative for Indiana’s 9th congressional district.

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