Metal Manufacturers Group Weighs in on Tariff Exclusion Process

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Yesterday, we noted a recent Aluminum Association letter, in which the industry group claimed the Department of Commerce’s Section 232 tariff exclusion request undermined the domestic aluminum industry.

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On Tuesday, the Coalition of American Metal Manufacturers and Users (CAMMU) also weighed in with its thoughts on the process.

Beginning in June, the DOC began receiving requests for exemptions from the steel and aluminum tariffs, as U.S. companies argued that the type of steel or aluminum product they needed is not made in the U.S. in the appropriate quantity or quality they need.

The sheer volume of requests seems to have taken the DOC by surprise. As MetalMiner’s Stuart Burns recently noted, by Oct. 29 the DOC had issued decisions in only about one-third of the nearly 50,000 total requests.

“Ideally, the Department would eliminate the Section 232 tariffs on steel and aluminum imports as it is clear that the utilization rates for domestic producers now exceed the goals set forth when these tariffs were implemented by the President,” the CAMMU release says. “As long as the tariffs remain, it is essential that exclusion requests are processed in a fair, transparent, and expeditious manner.”

In its letter, addressed to Secretary of Commerce Wilbur Ross, CAMMU explains that while the changes introduced to the tariff exclusion process in September were a nice start, further improvements are needed.

CAMMU specifically calls out statements from metals producers in formal objections that do not meet the “available immediately” threshold, defined as being able to supply within eight weeks.

“Objections to exclusion requests available on the Regulations.gov website reveal numerous vague assertions that clearly could not meet the ‘available immediately’ threshold set forth by the Department,” CAMMU argued. “The Department should reject these objections outright. For example, steel and aluminum producers regularly disregard the process for quality and testing that steel‐ and aluminum‐using manufacturers must go through with their customers prior to acceptance of products.”

In addition, CAMMU opined that the typical timeline for the resolution of a tariff exclusion request is too long, particularly given the just-in-time nature of some manufacturing. In the letter, CAMMU said the DOC should accept exemption requests in cases for which it receives no objections (or if it receives an incomplete objection).

CAMMU said the timeline manufacturers face vis-a-vis the exemption request process is too slow:

We also believe the stated 106 day timeline from date of posting does not fully reflect the delays faced by requesters. According to available data, American manufacturers must wait on average nearly 23 days, and almost 17 days for aluminum exclusion requests, before the Department posts their steel exclusion requests on regulations.gov. In the best of circumstances, this means that the average U.S. manufacturer must wait more than four months for the federal government to determine whether its most important input is subject to a 25% or 10% tax. No manufacturer can afford to lose one‐third of the entire calendar year waiting for a response made in a system that places greater weight to the objections raised than to the facts presented by actual purchasers of the raw materials.

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CAMMU’s full letter is available here.

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