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Aluminum and Steel Tariffs Could Mean Supply Issues for U.S. Manufacturing

New tariffs on steel and aluminum imports from Canada, Mexico, and the European Union (EU) went into effect on June 1, 2018. National security investigations of steel and aluminum imports to the United States under Section 232 of the Trade Expansion Act of 1962 have been cited as the impetus for imposing tariff rates of 25 percent on steel and 10 percent on aluminum. Earlier this year, the Department of Commerce recommended the imposition of tariffs, concluding that imports of steel and aluminum threaten U.S. national security.

Steel and aluminum tariffs relating to the Section 232 investigations for imports from most countries, first went into effect on March 23, 2018. Canada, Mexico, and the EU had temporary exemptions, which were set to expire on June 1. The Administration announced on May 31 that the exemptions would not be renewed due to insufficient progress in NAFTA negotiations and talks with the EU.

Since the June 1st tariffs took force and word of countermeasures against U.S. products came out, analysts have been discussing the unintended effects and consequences, including impact on U.S. manufacturing and the economy. Domestic manufacturers that rely on global supply chains must consider how they will navigate the fallout. Many U.S. manufacturers are applying for exclusions through the Commerce’s Bureau of Industry and Security.

These recent tariffs are just one example of how politics and world economies can quickly trigger instability and create serious supply issues for businesses. Supply risks manufacturers face today can have a detrimental effect on a business’s productivity and profits as companies increasingly rely on overseas suppliers and global supply chains. Small to mid-sized companies can be especially susceptible to supply risks as larger buyers often get preferential prioritization with suppliers.

Developing strategic partnerships with dependable suppliers is the best way to avoid supply chain risks and uncertainties. Winston Manufacturing offers businesses many advantages as a manufacturing supplier. In addition to comprehensive metal fabricating capabilities and access to the newest technology in precision fabrication and metal bending equipment, Winston Manufacturing offers its customers supply chain security through our bulk material buying leverage. Not only can we secure the best pricing on materials, we have stability with our suppliers due to the high volume purchasing power of Winston Industries.

Contact us today to learn how we can help you as your dependable and highly capable manufacturing supply partner.

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