This Morning in Metals: British Steel Teeters on Precipice of Administration
This morning in metals news, Britain’s No. 2 steelmaker is at risk of collapsing, U.S. aluminum maker Century Aluminum responded to the Trump administration’s decision to remove the Section 232 tariffs for Canada and Mexico, and rare earths could prove to be a weapon in China’s arsenal as trade tensions with the U.S. continue.
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Trouble for British Steel
As MetalMiner’s Stuart Burns wrote yesterday, British Steel, Britain’s second-largest steelmaker, is in trouble, as evidenced by its multiple requests for government assistance to stay afloat.
The firm has pointed to the uncertainty engendered by Brexit as a major factor contributing to its woes.
The situation appears to be dire; according to Reuters, the company could collapse without an emergency £30 million loan. The report cites a source who states EY administrators could be appointed as early as Wednesday if the firm cannot secure the loan.
Century Aluminum Responds to Trump’s Tariff Move
Jesse Gary, vice president of Kentucky-based Century Aluminum, said he supported the Trump administration’s decision to pull its Section 232 steel and aluminum tariffs from Canadian and Mexican imports, NPR affiliate WEKU reported.
“One key aspect of it is you’ll see there’s a mechanism to ensure that Canada and Mexico don’t exceed their historical levels of imports or surge over their historical levels of imports. And this is important because it means it allows room for the U.S. industry to continue to grow,” Gary was quoted as saying.
Rare Earths Could Take Center Stage
China boasts overwhelming control over the global rare earths sector, which makes it no surprise that the Trump administration opted to remove rare earths from its final $200 billion tariff list last year.
Rare earths are coveted for their use in things like cellphones, laptops and electric vehicle batteries, among other high-tech applications.
The U.S.’s dependence on China for rare earths could be used against it. This is particularly true on the heels of the recent deterioration in the terms of trade negotiations between the two countries, as the U.S. raised tariffs on $200 billion in Chinese goods, while China retaliated with tariffs on $60 billion in U.S. goods.
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The Washington Post notes that, in response to the U.S.’s moves against Chinese phone maker Huawei Technologies, China could consider a rare earths export ban or curbs.
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