U.S. President Donald Trump is holding a "listening session" with steel and aluminum executives on Thursday but he will not announce a final decision on whether to impose tariffs on imports of the products, officials in the White House said.
Trump has until April 11 to decide on applying hefty tariffs or quotas to steel imports in a move that would increase tensions with China, whose top trade official Lui He is in Washington for trade talks.
The administration says duties would protect U.S. industry, but critics say they would raise costs for industry and fail to deliver on a campaign pledge to boost domestic jobs.
Trump tweeted on Thursday that American steel and aluminum companies needed "free, fair and smart trade". Trump has indicated he favors a duty of 24 percent on steel imports.
Wall Street`s main indexes fell as industrial stocks, including heavyweights Boeing and Caterpillar, took a beating on fears that potential tariffs on steel imports could hit profits.
Trump has a range of options based on a report by the Deparment of Commerce with duties options of at least 24 percent on all steel products from all countries, and at least 7.7 percent on all aluminum products from all countries. [L2N1Q60V8]
Although China only accounts for two percent of U.S. steel imports, its massive industry expansion has helped produce a global glut of steel that has driven down prices.
China has indicated it could retaliate against U.S. steel tariffs by targeting imports of U.S. agricultural commodities, such as soybeans of which America is the largest supplier.
Trade tensions between the United States and China have risen since Trump took office in 2017 and the administration is also pushing on what it regards as forced technology transfers to China.
Shares of Asian steel producers such as South Korea`s POSCO and Nippon Steel fell overnight, while those of U.S. producers AK Steel, US Steel Corp and Nucor - jumped on prospects of import tariffs.FEW MORE JOBS FROM TARIFFS
While American steelmakers have lost three quarters of their jobs between 1962 and 2005, a major study by the American Economic Association showed that much of this had been due to improved production technology as output per worker rose fivefold.
"Thus, even if trade protection leads to increased domestic production, increases in employment may be far less than many hope," a report from the highly-regarded independent Econofact economist network said last week.
Consumers of steel and aluminum have lobbied hard against the tariffs. Econofact said in its report that two million jobs were in industries that use steel "intensively", including auto parts, household appliances, farm machinery and oil equipment.
Jobs in the consuming industries are concentrated in California, Texas, the Northeastern and Midwestern states that comprise the rust belt and states in the Southeast.
"Across many states, the number of jobs adversely affected in these steel-using industries could far exceed any steel jobs saved," Econofact warned.
"Past experience also shows that unilateral action like Section 232 tariffs will invite retaliation — the Bush-era steel tariffs led many countries to target politically sensitive U.S. exports like Florida oranges and North Carolina textiles."
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)