When President Donald Trump was elected in 2016, the U.S. primary aluminum industry was on its deathbed. Undercut by Canadian producers that relied on cheap and clean hydroelectricity to power modern smelters, and unable to compete with subsidized Chinese imports, the U.S. industry had shrunk to five plants operating below capacity.
Tariffs Mr. Trump imposed on Canadian raw aluminum imports in 2018 bought the U.S. industry some time, but not enough to fix its fundamentals. When the tariffs were lifted last year – as part of a good-faith gesture aimed at securing ratification of the United States-Mexico-Canada trade agreement – it was only a matter of time before U.S. aluminum producers began to clamour for their renewal.
Last week, Mr. Trump answered their pleas, proving that the most protectionist U.S. president in modern history never really intended to honour the spirit or the letter of the USMCA, which went into force barely a month ago.
Many observers saw the renewal of a 10-per-cent tariff on Canadian primary aluminum as an election-year move aimed at buttressing the political fortunes of Mr. Trump and other Republicans in states and districts that are home to aluminum smelters.
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