Frequently Asked Questions

How long do the Section 232 tariffs on steel need to remain in place?

Section 232 measures were, and remain, necessary because our Nation’s ability to make the steel we need for our economy, security, infrastructure, energy, and food supply is at risk from massive overcapacity and overproduction of steel around the world. Before these measures can be lifted, the President and Congress need to take a number of actions to put in place effective solutions to address global steel overcapacity—currently estimated to be 625 million metric tons, over 7 times the entire U.S. market and over 30 times total U.S. imports. Section232 measures are calibrated and effective – they are helping U.S. steelmakers increase output, hire more workers, and make the capital investments required for a sustainable long-term future.

Are there more limited approaches or trade tools that could be used to address overcapacity instead of Section 232?

In contrast to past efforts from both Democratic and Republican Administrations to address global overcapacity, the Section 232 measures on steel are working to support domestic industry, steel workers, steel communities, and our national economic security. Biden Administration officials have pointed to data showing that these measures are working and have said that global overcapacity continues and tariffs are a legitimate tool in protecting U.S. national security interests and good American jobs. Courts have also reinforced the legality of Section 232 measures.

While other approaches and methods can be used to address the global steel overcapacity problem, these are limited in scope and fail to address the overcapacity problem in a meaningful way.

This is a global issue and ultimately requires a global solution.

Are American consumers and industries paying for Section 232 measures in the form of higher prices?

No. The facts don’t support that claim. A recent report released by Economic Policy Institute (EPI) shows that the Sec.232 measures have had no measurable impact on prices in downstream steel consuming industries in the U.S. The EPI report and other economic analyses show that prices were either unaffected or not materially impacted across the broad array of U.S. industries accounting for a majority of U.S. steel consumption. The EPI study also shows that these measures supported reinvestment in American capacity that has begun to come online and will lead to more domestic supply and, thus lower—but still fair—steel prices, over time.

Why does a national security tariff apply to allies like the EU, Japan and others? Isn’t China the biggest issue?

The purpose of this action is to ensure that the United States has a viable steelmaking capacity for our national and economic security. We cannot afford to be dependent on anyone in the world for such a fundamental component of security, manufacturing, energy and economy. There is no doubt that China poses a challenge, yet other steel producers are actively feeding excess steelmaking around the world that impacts the USA. The problem goes well beyond China
While many global steel producers cut back on production as a result of COVID-19, countries around the world continued to increase production — even after setting a new record level of steel production last year. The European steel industry has 25 to 30 million tons of excess steel capacity, according to McKinsey & Company. Over 70 definitive trade measures – including antidumping and countervailing duties – related to steel or steel products have been implemented globally against imports from the EU. The largest Japanese steel producer recently conceded that it needs to reduce Japanese capacity by roughly 20%. Russia, Japan, Korea and Ukraine are all bigger net steel exporters than China.
This is a global problem. Global steel overcapacity, fueled by foreign government subsidies and other forms of state intervention, was estimated at more than 625 million metric tons in 2020, over seven times the total steel output of the United States.
Moreover, China’s exports of steel-containing goods dwarf every other country, and the USA imported 49 MMT of indirect steel imports in 2019. This demonstrates just how much outsourcing and cannibalizing of America’s manufacturing base has already taken place. If downstream production is re-shored, North American steel demand would have the potential to grow.
The nature of the global problem requires us to maintain the Section 232 measures to prevent renewed import surges that would destroy high-paying manufacturing jobs and undermine a critical U.S. industry, at the very time we are rebuilding from the pandemic.