Final Thoughts

Final Thoughts
Written by Ethan Bernard
January 21, 2025
Sometimes new presidential administrations hit the ground running. No time for change like the present. And sometimes new administrations blast off on a SpaceX rocket bound for Mars. There’s a big universe, and we’ve got a lot of flags to plant. Such seems to be the case with the new Trump administration.
I mean, President Trump really did talk about going to Mars in his inaugural address on Monday, as well as “manifest destiny.” Will the US Space Force end up functioning like the US Navy, safeguarding free trade across the “final frontier”?
After the speech, the president was very, very busy. The presidential actions taken on the first day… Well, I would call them a raft. But with their sheer number, they might be better compared to a cruise ship. (If you missed it, here is Putting People Over Fish: Stopping Radical Environmentalism to Provide Water to Southern California.)
Now I could talk about the Delta smelt for ages. But getting back to planet Earth, one item with enormous implications for steel is a comment President Trump made while signing executive orders on Monday evening. He said the US could enact 25% tariffs on Mexican and on Canadian imports to the country as soon as Feb. 1. SMU Editor-in-Chief Michael Cowden covers it here.
Canadian recycler
A Canadian metal recycler told SMU they ship a significant portion of their scrap to US mills and foundries. With a 25% tariff slapped on scrap, they simply “don’t know what will happen.”
The tariff has the potential to send the price of scrap shooting up in the US, while sending it down in Canada. Whatever happens, it’s definitely going to have an effect on the market, and not just on scrap.
But is it just a high-stakes bargaining ploy to bring our USMCA partners to the table well ahead of the periodic review of the agreement in 2026? Or perhaps on other issues such as immigration and drug trafficking? At this point we can’t be sure. Still, I wouldn’t want to be a Delta smelt right about now.
We’re obviously going to find out soon on those tariffs because Feb. 1 is only a little over a week away. In general, though, what was the consensus of associations representing American steel mills about Trump’s first day?
Steel trade groups respond
Kevin Dempsey, president and CEO of the American Iron and Steel Institute (AISI), was upbeat on this administration’s outlook on trade.
“We welcome President Trump’s commitment to treating trade policy as a critical component to national security and to pursuing a robust and reinvigorated trade policy agenda to tackle many of the issues that are priorities for the American steel industry,” he said in a statement on Tuesday.
Dempsey highlighted, among other things, addressing unfair trade practices. He also cheered the administration’s pledge to review and assess the effectiveness of the Section 232 steel tariff program that Trump established in 2018.
“We urge the new administration to take active steps to reinvigorate that program to ensure it is meeting the objectives originally established by President Trump during his first term,” Dempsey added.
Philip K. Bell, president of the Steel Manufacturers Association (SMA) was also bullish in his comments on Trump’s first day. First, Bell congratulated Trump on his inauguration, and he lauded Trump’s support for American steel workers.
SMA presented a five-point action plan for steel to Trump while he was still president-elect. In it, the association asked Trump to stand up to “unfair” trade practices. “And he is doing just that,” Bell said in a statement to SMU on Tuesday.
Bell noted that legislation such as Leveling the Playing Field 2.0 will give the administration “even stronger tools” to enforce trade rules and to investigate unfair trade practices as well as their impact on domestic manufacturing.
Both groups looked forward to working with the new presidential administration to help advance the interests of domestic steelmakers.
Looking ahead
A week from now, a month from now, a year from now, what will the political/economic landscape look like? Like a Martian desert? At this point at SMU, we’re just trying to hang in there for tomorrow’s news cycle. “Interesting times” are newsy times. And for smelt and for steel, these are newsy times.
Tampa Steel Conference
Whether you want to talk smelt or steel, we look forward to catching up with so many of you at the Tampa Steel Conference on Feb. 2-4.
If you haven’t made plans to attend yet, you can see the companies who will be there here. The agenda is here. And you can register here.
In the meantime, we thank all of you for your continued support. We really do appreciate you!

Ethan Bernard
Read more from Ethan BernardLatest in Final Thoughts

Final Thoughts
As Wolfe Research’s Timna Tanner put it in her opening talk at Tampa on Monday afternoon, we’re living in a world of “Trumplications” now. That probably means – at least in the short term – higher scrap costs, lower imports from countries hit with or threated tariffs, and higher steel prices. SMU data reflects that. Scrap went up in January. More than 75% of the respondents to our more recent survey expect scrap to go up again February, maybe by a lot. Lead times, meanwhile, have been ticking upward this month. It started with hot-rolled coil and plate earlier this month. Now we’re seeing coated lead times extending too.

Final Thoughts
We joked in our last Final Thoughts that Wiley trade attorney Tim Brightbill – one of the nation’s leading experts on trade law and policy – would probably be revising his presentation on Trump, trade policy, and tariffs for the Tampa Steel Conference. He did. And even after those last-minute revisions, he actually got trumped […]

Final Thoughts
The whole SMU team is packing up our laptops and our SMU polos/cardigans, loading up the PowerPoint slides, and preparing to make the trek down to Florida for the Tampa Steel Conference. There will be plenty to talk about!

Final Thoughts
From one group of folks, I’ve heard that Trump might not wait until Feb. 1 – the date he threatened on to place tariffs on China, Canada, and Mexico. They say he could act as soon as Friday. And then there are those who don’t think anything will happen before April 1. That’s the deadline for Commerce, Treasury, and USTR to submit key reports on “America First Trade Policy” to President Trump.

Final Thoughts
Trump made a clarification in a speech on Monday. Previously, he had declared the word “tariff” the most beautiful word in the dictionary. No longer.