Final Thoughts

Age of the deal?

Lewis Leibowitz has a good column on the US–UK agreement that was reached last week. We ran a news item on it as well.

The open question Leibowitz posed is if this will open the door to a slew of agreements in the coming weeks, months? Of note to steel, was the deal mentions an “alternative” to the blanket Section 232 tariffs on steel and aluminum. But we still don’t know yet what that will look like.

However, one notable deal has come in since then. It’s not definitive. And it does involve a 90-day pause. But it’s China, so it’s big. So big you can probably imagine it in Trump’s voice: Chi-na.

Now that’s a big deal

Kevin Dempsey, president and CEO of the American Iron and Steel Institute (AISI), applauded the agreement reached by the US and China on Monday.

He said in a statement the pact “aims to temporarily reduce tariffs, eliminate retaliation, and retain a US baseline tariff on China while continuing future trade discussions.”

Dempsey also noted the agreement was important for steel.

“American steel producers are all too familiar with the detrimental effects that unfair trade practices by China and other countries have had on domestic industries and their workers, and are pleased that measures to address these unfair trade practices will remain in place,” he said.

He commented that AISI “appreciates that the Section 232 steel tariffs and the Section 301 tariffs on steel from China will remain fully in effect under this new agreement.”

Meanwhile, US tariffs will fall to 30% from 145%, while China’s goes down to 10% from 125%, according to an article in Yahoo Finance. These changes go into effect for 90 days as further negotiations continue.

A fact sheet from the White House on the deal is available here, as well as the joint statement from the governments of both nations.

What’s next?

President Trump is in Saudi Arabia. Is another shoe about to drop? And, more importantly, how much will the tariff be on said shoe if it is made outside of the United States?