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Tue June 12, 2018

After more than a two-month suspension where the countries negotiated for permanent exemptions, the Trump Administration ultimately decided to move forward with its plan to place tariffs on steel and aluminum imports originating from its strongest trading partners last week. Tariffs of 25 percent on imported steel and 10 percent on imported aluminum are now in effect on Canada, the European Union and Mexico.

The tariffs are a result of an investigation on the effect imports have on national security, conducted under Section 232 of the Trade Expansion Act of 1962. Only steel imports from Argentina, Australia, Brazil and South Korea and aluminum imports from Argentina and Australia are exempt from the tariffs. Each of these countries are still subject to quotas, however, which limit the amount of steel and aluminum that can enter the U.S. supply chain.

Retaliatory tariffs from the EU, Canada and Mexico (untranslated) and (untranslated list) came quickly. Plastic products were only included in Canada’s $12.2 billion (C$16.6 billion) tariffs to be imposed on July 1. The plastics articles originating in the U.S. that will be subject to a 10-percent tariff before entering Canada are:

            3923.21.90        Other sacks and bags (including cones) of polymers or ethylene

            3923.29.90        Other sacks and bags (including cones) of other plastics, NESOI

            3924.10             Tableware and kitchenware

            3924.90             Household articles and hygienic or toilet articles, of plastics

Under Section 232, President Donald Trump can impose tariffs unilaterally. Nonetheless, Congress is not taking the tariffs lightly. On June 6, Senator Bob Corker (R-TN) sponsored a bipartisan bill with 12 other Republican and Democratic senators that would require Congress to approve of tariffs under Section 232. This authority will apply retroactively to all such tariffs imposed during President Trump’s term in office. Senator Corker failed to get the votes on the Senate floor to attach his tariff language to the defense appropriations bill on June 12. It is unlikely that this legislation will be brought up in the Senate again this year.

PLASTICS staff continues to follow this and all trade issues that will impact our member companies. We have reached out to the White House, the Office of the United States Trade Representative, the Department of Commerce and Capitol Hill to express our strong opposition. PLASTICS also issued a statement opposing the tariffs on steel and aluminum.

We will continue to make timely updates on trade announcements. If your company wishes to apply for an exemption to the steel or aluminum tariffs, please contact Suzanne Morgan at smorgan@plasticsindustry.org.