Canadian Aluminum To Again Face 10% Tariff

Fox Rothschild LLP

Fox Rothschild LLP

On August 6 the Trump Administration announced that it would reimpose the 10% aluminum tariff on imports of Canadian “non-alloy unwrought aluminum” classified under HTS subheading 7601.10. The move has not garnered widespread support from industry or the US Chamber of Commerce, who called it “a step in the wrong direction.” The Administration’s proclamation claims an 87% increase in imports of Canadian non-alloyed unwrought aluminum between June 2019 and May 2020; however, the US Aluminum Association recently reported a 2.6% decline in primary aluminum imported from Canada from May to June and a 5% overall reduction in the first quarter 2020 as compared with first quarter 2017. In urging the Adminsitration to reconsider the reimpositin of aluminum tariffs against Canada, the US Chamber of Commerce commented that “thse tariffs will raise costs for American manufacturers, are opposed by most US aluminum producers, and will draw retaliation against US exports.”

This move comes roughly a month after the US-Canada-Mexico Agreement (USMCA) came into effect and risks further disruption to the US’ relationship with one of its largest trading partners. Canada has already announced its intent to impose countermeasures that would include “dollar-for-dollar” retaliatory tariffs on US goods.  In its defense of the increase, the Trump Administration claims Canada flooded the US market with aluminum following the Administration’s agreement to lift the original 10% aluminum tariff with respect to Canada last year.

As it stands, the tariff increaes is set to go into effect on goods imported or withdrawn from warehouse after August 16, 2020.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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