In March 2018, U.S. President Donald Trump ordered tariffs on imported steel to increase by 25 percent. Asserting that “Trade wars are good and easy to win,” the president issued the order as part of his plan to reverse what he believed to be a decades-long posture of defeat in global trade policy.
The targets of this strategy included the European Union (EU), Mexico, and Canada, with steel from China falling under a separate sanction. Morgan Stanley estimates that steel and aluminum constitute 4.1 percent of American imports. The question remains: did these actions benefit the American steel industry?
The consensus among many media sources is a short-term yes and a long-term no. According to the Washington Post, steel prices and production initially rose after the executive order, yet those improvements did not translate into higher employment rates. This may be due to technological advances whereby production facilities can yield greater output without requiring additional personnel.
Another hindrance to hiring came at the outset of 2019 as the global economy nearly halved. As spending in the automobile, durable goods, and energy sectors dropped, so did steel prices to a large degree
The Steel Industry Response
Responding to the March 2018 change in policy, steel manufacturer executives upgraded and expanded production capacity. The subsequent drop in demand left them in a position of laying off employees and idling furnaces. Although Trump later lifted the tariffs on Canada and Mexico, the excess steel from China kept the demand low.
While many variables remain undetermined, e.g., trade negotiations with China and the not-yet ratified deal with Mexico and Canada, it is clear that levies on foreign goods–whether right or wrong–will not preserve metal manufacturing in and of themselves.
At the same time, not all voices are pessimistic. While construction growth might slow, it is expected to climb because of continued public investment, e.g., schools and infrastructure. Using rolled round bars in frameworks, supports, and braces means that the construction activity increases the need for steel.
Other once-reliable sectors, like auto manufacturing, are subject to less promising outlooks. Absent government intervention, producers must maintain continued innovation and efficiencies to compete under tighter conditions.
Advance Grinding Services is Prepared
The staff at Advance Grinding Services Inc has known this all along. This is why its centerless grinding and precision grinding processes apply to steel and other materials. Its precision round bars can be stainless steel, carbon steel, aluminum, titanium, brass copper, or bronze. Whether manufacturers look for high tolerance, corrosion resistance, or electrical conductivity, our company will match the suitable material to any task or application.
With both cold and hot finished projects, we deliver on time, by industry standards of excellence, and to the satisfaction of our customers. Advanced Grinding Services Inc does not wait for prosperity when the global, national, or local economy becomes rocky. We earn it with a superior product and always reliable customer service. Contact Advance Grinding Services today, and receive three competitive quotes!