Trump, Citing U.S. Farmers, Slaps Metal Tariffs on Brazil, Argentina

Metal smelting furnace in Chinese steel mills

Trump Restores Steel and Aluminum Tariffs on Brazil and Argentina 4Getty Images John Carney2 Dec 2019

Last year, after having accused the two South American countries of weakening their currencies to get an unfair advantage, the USA president imposed a 25 percent tariff on steel and a 10 percent duty on aluminum. "If a deal cannot be reached by the end of this week, I do not see how USMCA can be ratified in 2019", said chairman Chuck Grassley, Iowa Republican.

As for the new proposed tariffs on French goods, US trade representative Robert Lighthizer said the administration might investigate digital service taxes in Austria, Italy, and Turkey, too.

Trump past year announced global tariffs of 25 percent on steel and 10 percent on aluminum but later approved exemptions for some countries, including Argentina and Brazil - after they agreed to quotas.

In a statement, Brazil's government said it was already in discussions with Washington. The U.S. government's dollar policy has traditionally been directed by the Treasury Department.

Barbosa suggested Trump's failure to respond to Bolsonaro's attempts to improve ties could affect Brazil's decision on whether to buy 5G wireless technology from China's Huawei.

The U.S. has imported about 3.8 million metric tons of steel from Brazil so far this year, most of which are slab, according to U.S. Census Bureau data.

Despite widespread complaints about the impact of the tariffs on U.S. businesses and consumers, as well as the hit to farmers who have been the target of retaliation from trading partners, Trump claimed in his tweet on Monday that Washington has taken in "massive amounts of money" from the tariffs.

Chinese companies have slashed their purchases of USA farm goods since the United States started its trade war with China 17 months ago.

Argentine production minister Dante Sica said he too would request a conversation with his United States counterparts.

The U.S. solar industry is losing out on the creation of around 62,000 jobs and $19 billion in investment thanks to Trump administration tariffs on imported panels imposed almost two years ago, according to a report published on Tuesday.

Trump announced his decision to restore the metals tariffs on imports from Brazil and Argentina with an early morning tweet.

Trump's accusation that the Brazilian and Argentine currencies were being artificially devalued was met with widespread skepticism.

In Brazil, the recent slide in the real has caused a public outcry and led the central bank to intervene, while Argentina put in place currency controls to steady its beleaguered peso.

The president went on to say the Federal Reserve should "act likewise", so many other countries stop taking advantage of the USA dollar by further devaluing their currencies.

"Lower Rates & Loosen - Fed!" he admonished the independent agency.

Trump has repeatedly urged the USA central bank to lower rates to below zero, but Fed policymakers have been reluctant.

Trump accused the two countries of hurting American farmers through currency manipulation. Brazil and Argentina are both big exporters of agricultural products.

AK Steel Holding Corp. rose 2.9 per cent in premarket trading at 7:32 NY.

Brazilian steelmakers' shares fell initially but then rebounded.

Typically, the United States provides businesses with some warning of tariff changes, delaying their effective date to allow goods in transit to arrive at American ports without being taxed.

Trump has imposed a number of punitive tariffs on foreign-made products, mostly from China, as part of his "America First" economic agenda. The shares pared some losses to trade down 2.9% in afternoon.

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