Natalie Sherman
Business Reporter, BBC News
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A new 25% tax should be imposed on imports of steel and aluminum in the United States from countries such as Canada, Mexico, Brazil, as well as the European Union.
The new tariff measures announced by President Donald Trump will mean that US companies wishing to bring metals in the country will have to pay more.
But there is a risk that companies will transmit additional costs, or part of it, to consumers.
Since steel and aluminum are key components in many products, what articles could become more expensive?
Canned food, beer and soft drinks
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About 70% of the steel used in the United States to make food cans are imported today, coming from countries like Germany, the Netherlands and Canada, according to Canada Manufacturers Institute (CMI), A group of companies representing Canadians.
After Trump ordered steel prices in 2018, many cans have won “exclusions” of these import taxes, on the objections of the Aciometers, given the limited production of the type of steel used for Make cans in the United States.
Since then, steel manufacturers have further reduced production, increasing prices, warned the CMI, which sent a letter to the Trump administration earlier this month signed by food companies, notably General Mills, Del Monte and Goya.
Robert Budway, president of the CMI, said that without exemption from canads of can can to import steel prices, the prices of grocery store for canned food made in the United States should increase.
“While the president may believe that these prices protect the steel industry, they certainly undermine our food security and our supply of supply for American canned food, on which the Americans count every day,” Budway said.
Regarding aluminum, brewers and manufacturers of soft drinks, such as Coca-Cola, have also warned that the move will add costs and could cause higher prices for customers.
“We control enough variables so that we can adapt and alleviate our path through what is happening,” said Coca-Cola director, James Quincey this week.
Trump said that there would be no exemption from the rules this time, or for individual products, for particular countries, but certain sectors hope that it will come back from this position.
Cars
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After Trump imposed prices on steel and aluminum during his first mandate, car manufacturers, including Ford and General Motors, warned that the measures would add about 1 billion dollars to each of their costs.
For customers, Morningstar estimated that pricing costs would increase prices of around 1%, or a price increase of $ 300.
David Whiston, Morningstar analyst, warned that Ford could face an increase in similar costs this time, but said that it was not clear how consumers would be affected.
According to Michael Wall, car analyst at S&P Mobility, pressures of affordability in a market where sales have not yet been returned to 2019 levels could limit the amount of costs that companies choose to transmit.
But he said that it was always “realistic” to expect that some of the costs of metal prices will be made to buyers.
However, he noted that Trump’s announcement by prices on all goods imported from Canada and Mexico, currently pending until March, would have a much more important impact for buyers.
At a business conference, Ford Managing Director Jim Farley warned that Trump’s recent movements caused “a lot of costs and a lot of chaos” for his industry.
TD economists have estimated that cars could increase by around $ 3,000 if general prices on Mexico and Canada goods have entered into force.
Construction, accommodation and devices
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The construction industry as a sector is one of the largest steel users, whose developers and manufacturers need for everything, construction frames for household appliances.
Carl Harris, president of the National Association of Home Builders, said that the decision to impose prices on steel and aluminum was “totally counter-confidence” to the declared objective to make housing more affordable , warning that it would increase costs and dissuade development and reconstruction.
“In the end, consumers will pay these prices in the higher prices of houses,” he warned.
The National Association of Maisons Manufacturers urged the president to exempt the building materials from the prices offered.
After Trump imposed steel prices in 2018, the Whirlpool aircraft manufacturer faced an unexpected $ 350 million leap in costs which, according to him, were fired by the leap in steel prices.
Companies unable to absorb these costs would probably transmit them by higher prices in stores.
