This morning in metals news, a hearing on NAFTA and possible renegotiation of the 23-year-old trilateral trade agreement continues into its second day, the results of the Trump administration’s Section 232 investigations into steel and aluminum imports might be subject to readjustments and copper has proven to be as precious as gold in some ways.
NAFTA Talks Continue Into Day Two
The Office of the United States Trade Representative kicked off hearings on the subject of NAFTA, soliciting views on if (and how) the trade agreement should be renegotiated.
Trump was was reportedly prepared to pull the U.S. out of the trade agreement in April before the Canadian and Mexican leaders convinced him otherwise.
For many, including those in metals industries, NAFTA has been mostly successful, but could be modernized.
The hearing continues today, having started at 9 a.m. ET and concluding at 6:30 p.m. ET. Yesterday’s hearing included comments from Hollie Noveletsky, CEO of Novel Iron Works, and Thomas Gibson, president and CEO of the American Iron and Steel Institute (AISI).
More than 1,400 public comments were submitted online ahead of the hearing.
A full list of scheduled speakers is available on the USTR website.
Malleable Situation: Prepping for 232 Recommendations
As the U.S. steel and aluminum industries await the announcements of the Trump administration’s policy recommendations following Section 232 investigations into imports of the metals, some industry organizations think the outcomes are subject to change.
Kevin Dempsey, senior vice president of public policy for AISI, told Platts there could be some fine-tuning of the administration’s announced course of trade actions.
As for retaliatory measures by other countries in the case of the Trump administration’s imposition of tariffs or quotas? Dempsey indicated to Platts the threat of retaliation in response to trade policy actions is always a possibility.
It has been 16 years since the last 232 investigation. What will happen this time around? Most are expecting tariffs, of course, but no one knows exactly what they will look like. In addition, the timeline for the announcement of the investigation’s findings is even murkier. According to Dempsey, the administration might even wait until after the G20 summit, which is scheduled to take place July 7-8.
Copper is Golden
When most people think of monetary stability, of safe-haven assets, they think of gold — and they’d be right to do so.
But when it comes to inflation, Bloomberg reports copper has actually kept up better.
According to a correlation analysis of total return commodity indexes compiled by Bloomberg, for every 1 percent annual increase in the consumer price index since 1992, copper jumped almost 18 percent, more than three times the 5.2 percent gain logged by gold.