Trump Trade War - US likely to extend steel and aluminum tariff exemptions

Trump Trade War - US likely to extend steel and aluminum tariff exemptions

Trump Trade War - US likely to extend steel and aluminum tariff exemptions

US President Donald Trump in March announced global tariffs of 25% on steel and 10% on aluminium, claiming that subsidized metal imports were threatening national security by harming domestic producers. South Korea made up the largest share, shipping about 13 percent of US imports, according to an American Iron and Steel Institute analysis of government data.

All eyes are on Washington Monday as the deadline looms on a temporary exemption granted to Canada on new steel and aluminum tariffs.

"The president has not made any decision yet", Mnuchin said in an interview on Fox Business Network. Wilbur Ross, the USA commerce Secretary, said over the weekend that administration planned to extend the relief to some countries, but not all, and refused to be drawn on which ones would remain exempt. Ross did not name the countries.

That change in tune has also come as Canada, the US and Mexico continue to negotiate towards an updated North American Free Trade Agreement (NAFTA).

Trump administration officials have said that in lieu of tariffs, steel and aluminum exporting countries would have to agree to quotas created to achieve similar protections for USA producers. The quota deal came as part of a broader renegotiation on the USA and South Korea's bilateral trade deal, KORUS.

Trump has said that such a huge trade deficit with China is not acceptable to his administration.

Foreign Affairs Minister Chrystia Freeland told reporters there had been good progress made on the key issue of auto parts. Canada is the largest source of steel imports into the United States, with an industry that is highly integrated with its southern neighbor. Ross is set to discuss the issue Monday with EU Trade Commissioner Cecilia Malmstrom. She has insisted on a permanent exemption without conditions.

A spokesperson for the European Commission said the EU is "patient but we are also prepared".

For instance, South Korea received a permanent exemption to the tariffs by agreeing to a quota for steel products, which limits the amount of metals the country can send the usa in a year.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. It is not a solicitation to make any exchange in commodities, securities or other financial instruments.

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