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Thread: Steel Tariff Fallout- Steel Plant Closures

  1. #1

    Steel Tariff Fallout- Steel Plant Closures

    Tariffs raised the price of steel for producers in the US so they are trying to use less steel. The falling demand is causing the closure of some plants. Steel tariffs were supposed to help the industry which is forecasting more weak demand.

    https://marketrealist.com/2019/06/u-...rse-for-trump/

    U.S. Steel Idles Plants, and Timing Couldnít Be Worse for Trump

    U.S. Steel

    Yesterday, U.S. Steel (X) announced its second-quarter guidance. The guidance was lower than what analysts were expecting. Nucor (NUE) and Steel Dynamics (STLD) also released their second-quarter guidance earlier this week. AK Steel (AKS) provides annual guidance during its earnings release. US steel stocks have bounced back this month amid the uptrend in broader markets. The SPDR S&P 500 ETF (X) is up 6.2% this month. The metals and mining sector has outperformed SPY in June.

    Plant closures

    Meanwhile, while U.S. Steelís guidance spooked markets, the company also announced plant closures. U.S. Steel will be shutting two blast furnaces in the United States and one in Europe. U.S. Steelís plant closure announcement couldnít have come at a worse time for President Trump, who started his 2020 campaign yesterday. Trump has said multiple times that his tariffs have revived the US steel industry and supported steel jobs. Last year, U.S. Steel restarted the Granite City blast furnace, aiming to capitalize on higher steel prices after tariffs. President Trump visited the facility after the restart.

    New investments

    Over the last year, there has been a flurry of new investments and restarts in the US steel industry. President Trump has cited the revival in the US steel industry to highlight the success of Section 232 tariffs. However, 15 months after tariffs, things seem to have come a full circle for US steel producers. US steel prices are now way below March 2018 levels when Trump announced the tariffs. Furthermore, after multiple growth projects, weíre now seeing capacity curtailments.
    Quote Originally Posted by Swordsmyth View Post
    The quality seems to have dropped significantly since I came here, I guess you get what you pay for.
    "There is always a tweet. That has become accepted fact in the Trump presidency: For every pronouncement the President makes, there is at least one tweet from his past that directly contradicts his current view." -CNN

    I am Zippy and I approve of this post. But you don't have to.



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  3. #2
    The tarriffs only applied to raw steel. If you bought fabricated rolled steel shapes made overseas it wasn't subject to the tariff.

    Only an economic ignoramus who favored tarriffs and opposed free trade could have not forseen an issue with setting up a tarriff on trade steel alone.
    Truth forever on the scaffold, Wrong forever on the throne,--
    Yet that scaffold sways the future, and, behind the dim unknown,
    Standeth God within the shadow, keeping watch above his own.
    ‫‬‫‬

  4. #3
    Quote Originally Posted by Zippyjuan View Post
    Tariffs raised the price of steel for producers in the US so they are trying to use less steel. The falling demand is causing the closure of some plants. Steel tariffs were supposed to help the industry which is forecasting more weak demand.

    https://marketrealist.com/2019/06/u-...rse-for-trump/
    Zippy, I have a question. Why do you support taxes on U.S. citizens by not on foreign corporations? Just curious.
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  5. #4
    Quote Originally Posted by jmdrake View Post
    Zippy, I have a question. Why do you support taxes on U.S. citizens by not on foreign corporations? Just curious.
    Tariffs are not on foreign corporations. The tariff is paid when the imported item crosses the border and is paid by the importer. Since the importer is about making money, they pass along the cost of the tariff they paid to consumers of their product. US tariffs on imports are paid by US consumers. The foreign company may lose business because now his products cost more for us to buy them, but the actual tariff is paid by US consumers.
    Quote Originally Posted by Swordsmyth View Post
    The quality seems to have dropped significantly since I came here, I guess you get what you pay for.
    "There is always a tweet. That has become accepted fact in the Trump presidency: For every pronouncement the President makes, there is at least one tweet from his past that directly contradicts his current view." -CNN

    I am Zippy and I approve of this post. But you don't have to.

  6. #5
    The plants would have closed anyway and perhaps more without the tariffs, China was trying to destroy our steel industry so that we couldn't supply our military in a war.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  7. #6
    Quote Originally Posted by Zippyjuan View Post
    Tariffs are not on foreign corporations. The tariff is paid when the imported item crosses the border and is paid by the importer. Since the importer is about making money, they pass along the cost of the tariff they paid to consumers of their product. US tariffs on imports are paid by US consumers. The foreign company may lose business because now his products cost more for us to buy them, but the actual tariff is paid by US consumers.
    Or the exporter lowers his prices to compensate (possibly subsidized by his government) and thereby pays the tariff.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  8. #7
    Quote Originally Posted by Swordsmyth View Post
    Or the exporter lowers his prices to compensate (possibly subsidized by his government) and thereby pays the tariff.
    Or they source the product from other places.

    But these two facts don't jive with Zip and the M$M's "Consumers pay for it!" mantra.

  9. #8
    If I could advise Trump, I would have told him to just subsidize the US steel instead of starting a trade war with China. This way you can protect US steel without the Chinese getting all butt hurt about it. It would work this way, any American manufacturer can buy steel at a cheap rate than the Chinese are selling if they plan on using it for domestic manufacturing.

    Over night the Chinese manufacturers would stop selling to the US and with time the industry can grown strong enough to sustain itself without subsidizes. Win, win and win
    You can maintain power over people, as long as you give them something. Rob a man of everything, and that man will no longer be in your power. Aleksandr Solzhenitsyn

    Quote Originally Posted by LibertyEagle View Post
    Trust principles; not people.
    My Che avatar is my unique way of giving a big middle finger to the, the neocons, the globalists, imperialists and most importantly to the left and right political establishment who hate his guts till this day. My admiration for him ends where his anti imperialist pro communism ideology starts.



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  11. #9
    Quote Originally Posted by Swordsmyth View Post
    Or the exporter lowers his prices to compensate (possibly subsidized by his government) and thereby pays the tariff.
    The tariffs are like 20%, most retailers don't have that kind of profit margin.
    You can maintain power over people, as long as you give them something. Rob a man of everything, and that man will no longer be in your power. Aleksandr Solzhenitsyn

    Quote Originally Posted by LibertyEagle View Post
    Trust principles; not people.
    My Che avatar is my unique way of giving a big middle finger to the, the neocons, the globalists, imperialists and most importantly to the left and right political establishment who hate his guts till this day. My admiration for him ends where his anti imperialist pro communism ideology starts.

  12. #10
    Quote Originally Posted by Swordsmyth View Post
    The plants would have closed anyway and perhaps more without the tariffs, China was trying to destroy our steel industry so that we couldn't supply our military in a war.
    Yeah, that is why we put steel tariff on Canada and Mexico. In case we go to war against them, our supply won't be interrupted.
    Quote Originally Posted by Swordsmyth View Post
    The quality seems to have dropped significantly since I came here, I guess you get what you pay for.
    "There is always a tweet. That has become accepted fact in the Trump presidency: For every pronouncement the President makes, there is at least one tweet from his past that directly contradicts his current view." -CNN

    I am Zippy and I approve of this post. But you don't have to.

  13. #11
    Quote Originally Posted by juleswin View Post
    The tariffs are like 20%, most retailers don't have that kind of profit margin.
    We are talking about exporters not retailers and government subsidies are often extended as well as I mentioned.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  14. #12
    Oh $#@! this is hilarious. Zippy stepping in his own $#@! again.

    United States Steel Corp on Tuesday said it would idle two blast furnaces in the United States and a third in Europe, as lower steel prices and softening demand led the steel producer to forecast current-quarter earnings below the Wall Street estimates.

    Steel producers in the United States have brought old capacity online after President Donald Trump’s imposed tariffs on imported steel from countries including China, resulting in a surplus supply of steel at a time when manufacturing demand has weakened, suppressing prices.
    U.S. Steel will idle a blast furnace at the company’s Gary Works facility in Indiana, ...
    The Gary Works facility has four blast furnaces with an annual raw steel production capability of 7.5 million tons. The second furnace to be idled is in the company’s Great Lakes Works facility, located in Ecorse and River Rouge, Michigan, which has three blast furnaces with annual raw steel production capability of 3.8 million tons
    https://www.reuters.com/article/us-u...-idUSKCN1TK03J

    So what you see here, is that supply is currently exceeding demand. So the are IDLING 2 out of 7 furnaces in the U.S.. Lol. And steel prices have come down despite the tariffs. Lol.
    Last edited by phill4paul; 06-19-2019 at 06:21 PM.

  15. #13
    Quote Originally Posted by Zippyjuan View Post
    Yeah, that is why we put steel tariff on Canada and Mexico.
    Because they were reselling Chinese steel that was being dumped, Trump removed those tariffs when they agreed to stop that.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  16. #14
    Quote Originally Posted by Swordsmyth View Post
    Because they were reselling Chinese steel that was being dumped, Trump removed those tariffs when they agreed to stop that.
    Link?
    Quote Originally Posted by Swordsmyth View Post
    The quality seems to have dropped significantly since I came here, I guess you get what you pay for.
    "There is always a tweet. That has become accepted fact in the Trump presidency: For every pronouncement the President makes, there is at least one tweet from his past that directly contradicts his current view." -CNN

    I am Zippy and I approve of this post. But you don't have to.

  17. #15
    Quote Originally Posted by juleswin View Post
    If I could advise Trump, I would have told him to just subsidize the US steel instead of starting a trade war with China. This way you can protect US steel without the Chinese getting all butt hurt about it. It would work this way, any American manufacturer can buy steel at a cheap rate than the Chinese are selling if they plan on using it for domestic manufacturing.

    Over night the Chinese manufacturers would stop selling to the US and with time the industry can grown strong enough to sustain itself without subsidizes. Win, win and win
    That creates socialism, tariffing China to compensate for their economic warfare is a much better option.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  18. #16
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment



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  20. #17
    Quote Originally Posted by Swordsmyth View Post
    That creates socialism, tariffing China to compensate for their economic warfare is a much better option.
    So what? its socialism with a goal of preserving manufacturing job and national independence from foreign steel supply also you only have it in place until the industry is strong enough to compete. Btw, the military is socialism, the VA is socialism, social security is socialism and I bet you won't be pushing for the end of those programs any time soon.
    You can maintain power over people, as long as you give them something. Rob a man of everything, and that man will no longer be in your power. Aleksandr Solzhenitsyn

    Quote Originally Posted by LibertyEagle View Post
    Trust principles; not people.
    My Che avatar is my unique way of giving a big middle finger to the, the neocons, the globalists, imperialists and most importantly to the left and right political establishment who hate his guts till this day. My admiration for him ends where his anti imperialist pro communism ideology starts.

  21. #18
    Well, you actually backed up a claim. Well done:

    https://www.cbc.ca/news/politics/tar...deau-1.4568470

    Trump was concerned that Chinese steel was entering United States through Canada: source

    As it lobbied to exempt Canadian products from Donald Trump's new tariffs, the Trudeau government had to contend with a fear on the American side that Chinese steel and aluminum products were getting into the United States through Canada, according to a senior government official.

    The American administration has singled out China in arguing that tariffs are needed to respond to unfair trading practices — but Canada is the largest supplier of steel and aluminum to the United States.

    According to the senior government official, speaking on condition of anonymity, Prime Minister Justin Trudeau used his conversation with U.S. President Trump earlier this week to counter a suggestion that Canada was a conduit for Chinese products.

    Trudeau is said to have told the president that Canadian steel and aluminum workers would be surprised to hear that their products are actually Chinese. He also reminded Trump that Canadian steel and aluminum are used to build American tanks and fighter jets.
    Speaking to reporters after an event in New York on Friday, Finance Minister Bill Morneau said the possible movement of Chinese products through Canada is not currently a problem — and Canada is committed to ensuring it doesn't become one.

    "We're going to go back and make absolutely sure it's not a problem so that we can continue to be a positive part of the Canada-U.S. trading relationship on steel and aluminum and assure that security advantage that we have together is sustained," Morneau said.
    Last edited by Zippyjuan; 06-19-2019 at 07:11 PM.
    Quote Originally Posted by Swordsmyth View Post
    The quality seems to have dropped significantly since I came here, I guess you get what you pay for.
    "There is always a tweet. That has become accepted fact in the Trump presidency: For every pronouncement the President makes, there is at least one tweet from his past that directly contradicts his current view." -CNN

    I am Zippy and I approve of this post. But you don't have to.

  22. #19
    Quote Originally Posted by juleswin View Post
    So what? its socialism with a goal of preserving manufacturing job and national independence from foreign steel supply also you only have it in place until the industry is strong enough to compete. Btw, the military is socialism, the VA is socialism, social security is socialism and I bet you won't be pushing for the end of those programs any time soon.
    You should only have as much "socialism" as is necessary to prevent more, subsidizing the steel industry is not a good idea.

    I push for an end to social security all the time.

    If the government built its own steel industry just to serve the needs of the military and government construction that would be better than subsidizing private corporations but it would still be worse than using tariffs to cancel out Chinese government manipulation of the market.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  23. #20
    Zippy fakenews headline. There is no plant closure. They are idling 2 out of 7 furnaces at 2 U.S. plants. They are doing this because Trumps tariffs were successful and allowed the entire U.S. steel to ramp up production to the point that steel cost was lowered and demand was met.

    Lololol. Thanks Trump!

  24. #21
    Quote Originally Posted by phill4paul View Post
    Zippy fakenews headline. There is no plant closure. They are idling 2 out of 7 furnaces at 2 U.S. plants. They are doing this because Trumps tariffs were successful and allowed the entire U.S. steel to ramp up production to the point that steel cost was lowered and demand was met.

    Lololol. Thanks Trump!
    Indeed. US Steel stock up 4.08% today on the news and about 9% for the week. That's not the result of bad news.

  25. #22
    Quote Originally Posted by Zippyjuan View Post
    Tariffs are not on foreign corporations. The tariff is paid when the imported item crosses the border and is paid by the importer. Since the importer is about making money, they pass along the cost of the tariff they paid to consumers of their product. US tariffs on imports are paid by US consumers. The foreign company may lose business because now his products cost more for us to buy them, but the actual tariff is paid by US consumers.
    +rep

  26. #23
    Quote Originally Posted by Zippyjuan View Post
    Tariffs raised the price of steel for producers in the US so they are trying to use less steel. The falling demand is causing the closure of some plants. Steel tariffs were supposed to help the industry which is forecasting more weak demand.

    https://marketrealist.com/2019/06/u-...rse-for-trump/
    AK Steel has been on the verge of going belly up for about 20 years .
    Do something Danke

  27. #24
    Quote Originally Posted by Swordsmyth View Post
    China was trying to destroy our steel industry so that we couldn't supply our military in a war.
    The US produces enough steel annually for ~1,500 aircraft carriers (we currently have 11).

    So, no, that's preposterous.
    "Democracy is the theory that the common people know what they want, and deserve to get it good and hard."

    -H. L. Mencken



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  29. #25
    Quote Originally Posted by r3volution 3.0 View Post
    The US produces enough steel annually for ~1,500 aircraft carriers (we currently have 11).

    So, no, that's preposterous.
    The idea was to destroy our industry so we couldn't make enough for our needs.
    What we currently can make is irrelevant.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  30. #26
    Quote Originally Posted by Swordsmyth View Post
    The idea was to destroy our industry so we couldn't make enough for our needs.
    What we currently can make is irrelevant.
    It's extremely relevant if what we currently can made is orders of magnitude more than we could possibly need for a war with China.
    "Democracy is the theory that the common people know what they want, and deserve to get it good and hard."

    -H. L. Mencken

  31. #27
    Quote Originally Posted by r3volution 3.0 View Post
    It's extremely relevant if what we currently can made is orders of magnitude more than we could possibly need for a war with China.
    Not if they destroy that capacity, which was their goal.
    It doesn't matter how much money I currently make if someone destroys my business, I will then not make any money.

    And their are many other aspects of their economic warfare aside from their intent to cripple our ability to defend ourselves.
    And many other aspects of our defense industries than steel that they sought to undermine.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  32. #28
    Quote Originally Posted by Swordsmyth View Post
    Not if they destroy that capacity, which was their goal.
    It doesn't matter how much money I currently make if someone destroys my business, I will then not make any money.
    There was no prospect of Chinese competition reducing US steel output to a dangerous level for the foreseeable future.

    And there's no justification for interfering in the market because of a chance of that happening at some point in the very distant future.

    But, by all means, keep spouting the adminstration's absurd propaganda.
    "Democracy is the theory that the common people know what they want, and deserve to get it good and hard."

    -H. L. Mencken

  33. #29
    Quote Originally Posted by r3volution 3.0 View Post
    There was no prospect of Chinese competition reducing US steel output to a dangerous level for the foreseeable future.

    And there's no justification for interfering in the market because of a chance of that happening at some point in the very distant future.

    But, by all means, keep spouting the adminstration's absurd propaganda.
    If you start with a faulty premise everything else you say will be just as faulty.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  34. #30
    Quote Originally Posted by r3volution 3.0 View Post
    There was no prospect of Chinese competition reducing US steel output to a dangerous level for the foreseeable future.

    And there's no justification for interfering in the market because of a chance of that happening at some point in the very distant future.

    But, by all means, keep spouting the adminstration's absurd propaganda.
    China only accounts for two percent of our steel imports anyways. Losing that would not be a threat to national security. (Canada is our #1 source).

    https://econofact.org/what-is-the-na...ile-protection

    The top source for imports of steel and aluminum is Canada. Other traditional allies of the United States are also primary sources of steel imports. In 2017, the top source of U.S. imports of steel was Canada with 17 percent of U.S. imports (by tons). The next largest sources of U.S. steel imports were Brazil (14 percent of US production), South Korea (10 percent) and Mexico (9 percent). Steel imports from China ranked 10th and represented 2 percent of U.S. imports (see here). It would be difficult to argue that imports of steel from Canada could become unavailable to satisfy national security needs. Canada was also the largest source of United States aluminum imports in 2017, accounting for 36 percent of total imports by value. Imports from Canada were over twice as much as Russia, and nearly five times as much as China. It is difficult to see how U.S. security is threatened by reliance on aluminum from Canada. Moreover, by statute, Canada is considered part of the Nation’s national defense industrial base.
    Quote Originally Posted by Swordsmyth View Post
    The quality seems to have dropped significantly since I came here, I guess you get what you pay for.
    "There is always a tweet. That has become accepted fact in the Trump presidency: For every pronouncement the President makes, there is at least one tweet from his past that directly contradicts his current view." -CNN

    I am Zippy and I approve of this post. But you don't have to.

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