The United States imposition of quota brinks in place of a 10% tariff on P1020 aluminium imports from Canada is set to be re-evaluated in 2021, but contrasting outshot appear to be viable under newly elected President Joe Biden’s incoming administration, as per the industry participants.
Jean Simard, CEO, Aluminium Association of Canada, said: “The aluminium industry is now ‘off the radar screen’ for continued tariff or quota enforcement in 2021 due to declining P1020 imports from Canada.”
Simard added: “It is expected that this new administration will not go back on the most recent executive order to try to implement it. Given the rolling average [of P1020 imports from Canada] from September to December, even this existing administration will not go back because, at the end of those four months, there was no problem. The price of metal is up, so everybody is happy.”
President Donald Trump started a few months back that the US would consider reinstating a 10% tariff under Section 232 on Canadian P1020, if imports exceeded levels set for the final four months of the year, according to an executive order signed in October. However, there was no specific plan to put in place to take effect after December’20, and it was very much unclear whether the quotas would continue into 2021.
Regardless of import levels, Simard described Biden and his nominee for US Trade Representative, Katherine Tai, as “multilateralists” who would foster collaborative policies and not likely slap tariffs or quotas on trade allies.
“I certainly believe that the Biden administration will find all the logic to get Canada out of Section 232. It doesn’t make any sense with their political logic in terms of the continental value chain and rebuilding North America,” Simard said.
Open trade with Canada’s low-carbon aluminium also supports the Biden administration’s “green’ agenda, according to Simard.
Standing on the other side of the issue, Century Aluminum COO Jesse Gary said: “The continuation of aluminium trade enforcement on Canada, and the larger Section 232 aluminium tariff applied globally, is crucial for supporting domestic primary aluminium production.”
“When you look towards the new administration and what their stated policies have been, one of the large areas of focus has been on bringing back US manufacturing jobs, and so you can see how the 232 programs would seem to fit well within the Biden administration’s goals,” Gary said.
A move which Gary attributed to the aluminium tariff, as the US-based Century Aluminium has been able to bring capacity back online at its Hawesville, Kentucky, smelter since 2018. The company is now prepared to increase utilization at its Mount Holly smelter in South Carolina as early as 2021.
Gary further added: “It was still too soon to predict what Biden will do with aluminium trade policy and the quota on Canada as he continues to build his administration.”
Laurence Goldfarb, a US-based aluminium distributor, said: “Biden is unlikely to remove any aluminium tariffs or quotas to align his policies with the interests of labour unions.”
“Biden is dependent on all of these democratic institutions, and the unions will not want him to lift it,” Goldfarb said. “Whether it’s Biden or Trump, I don’t think Section 232 will come off.”
source https://www.alcircle.com/news/the-aluminium-industry-is-now-off-the-radar-screen-ceo-aluminium-association-of-canada-62127
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