U.S. tariffs on Canada’s aluminum industry will raise costs — for U.S. manufacturers – by Naomi Powell (Financial Post – June 5, 2018)


On Friday morning, a truck hauled out of a shipping yard at Sotrem-Maltech in Saguenay, Que. packed with specialty aluminum ingots bound for a foundry in the Midwestern United States. There, they were slated to be transformed into complex parts used in the manufacture of U.S. military vehicles, including four-wheel drive trucks and carriers.

It was a typical order for the company, but one that happened to take place less than 24 hours after the United States imposed sweeping tariffs of 10 per cent on Canadian aluminum — all on grounds of national security.

“Nothing much has changed for us, no,” said Patrick Dube, commercial director for Sotrem-Maltech, which also makes aluminum granules for coatings on U.S. aircraft carriers. “There are very few companies who do what we do and they are all at full capacity. The only change is that it will cost 10 per cent more. And we don’t know who will pay for that, the customers or us.”

Following decades of specialization and a steep decline in U.S. smelting capacity, analysts say the U.S. tariffs are unlikely to deliver a blow to Canadian aluminum producers, who supply 47 per cent of the aluminum consumed in the United States.

However, the levies have raised concerns about rising costs for U.S. manufacturers and downstream producers — the foundries and rolling facilities that now account for 97 per cent of employment in the U.S. Industry.

For the rest of this article: http://business.financialpost.com/news/economy/u-s-tariffs-on-canadas-aluminum-industry-will-raise-costs-for-u-s-manufacturers

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