EuroWire March 2019

Transatlantic cable

control process itself was an element in the failure of the beams is a matter of close study for the TJPA. “Obviously, something was missing,” he told the Marin Independent Journal . Did the 25 per cent tariff imposed by the USA on imported steel rescue the domestic industry? The facts declare otherwise “They were doing very poorly when I took office, and now they’re doing very well,” US President Donald Trump said of American steel makers in January. “Our steel industry was dying, and now it’s very vibrant.” Mr Trump credits the 25 per cent tariff he imposed on steel imports in March of 2018, and implemented that June, for what he claims is a dramatic turnaround. But American businesses and trade groups have repeatedly urged the Trump administration to remove the tariffs, claiming that they hurt domestic companies, not competitors, and will ultimately undercut US economic growth. A recent article in the New York Times supplied statistics that unambiguously refute Mr Trump’s estimate of the efficacy of the tariff and support that of its critics. (“US Steel Companies Face Downturn Despite Trump Claims of Revival,” 14 th January) Alan Rappeport, a Washington-based economic policy reporter at the Times , noted that steel prices in the United

States had fallen back to levels last seen before the tariffs on steel and aluminium imports were announced a year ago. Hiring in the steel sector remains stagnant, in part because new mills have become more reliant on automation. According to data cited by Mr Rappeport from the American Iron and Steel Institute (AISI), the industry’s lobbying group, even with the opening and restarting of several mills last year, direct steel industry employment in the USA was 146,300 as of November – four per cent lower than it was four years before. Moreover, he observed, investors are increasingly wary about the industry’s long-term strength, and American steel makers are feeling the pressure. Despite strong earnings in 2018, the stock prices of steel companies have been in a deep slump. Over the last year, AK Steel was down 56 per cent; US Steel, down 46 per cent; Steel Dynamics, down 29 per cent; and Nucor, down 18 per cent. The not-unmixed blessing of higher prices Mr Trump routinely points to rising steel prices as a boon to American steel companies. But Mr Rappeport pointed out that the price spike that followed on the announcement of the tariffs ultimately hurt demand. Industries reliant on steel, such as automotive and construction, struggled to absorb the rising costs of imported steel or passed them on to customers. Caterpillar, the farm equipment manufacturer, said last year that it faced $200 million in additional costs deriving from the steel tariff. According to S&P Global Platts, prices for American-made hot-rolled coil steel, the industry benchmark, jumped 41 per

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March 2019