Dive Brief:
- President Donald Trump announced Thursday the U.S. would begin imposing a 25% tariff on steel imports and a 10% tariff on aluminum imports beginning next week, according to Reuters. The administration is sidestepping the World Trade Organization and instituting the tariffs based on what it has deemed an issue of national security.
- U.S. steel and aluminum manufacturers' stock prices jumped following the news, but fears of higher prices and retaliatory action from U.S. trade partners forced shares lower for companies that rely on these products, notably car and airplane manufacturers.
- There are no specifics about the tariffs' implementation, or possible exemptions for certain trade partners, but the United Steelworkers union is advocating for an exemption for Canada, according to Engineering News-Record.
Dive Insight:
Aluminum and steel might not seem like products that have a direct tie-in to everyone the waste industry, but Trump's actions are likely to reverberate. Prices for domestic steel and aluminum are likely to increase — which means domestic recyclers of aluminum could get higher prices for their products.
It also means WTE companies, such as Covanta, could see an increase in revenue. During the company's latest earnings call, CEO Steve Jones said they'd be closely watching the actions of the Trump administration.
"Tariffs of this type would likely benefit domestic steel and aluminum prices and could improve demand for our products," he said during the call. He added later that a similar tariff, implemented briefly by President George W. Bush in the early 2000s, "had a big impact, I think positive impact, if you are us, on both ferrous and non-ferrous pricing."
Some waste industry groups do not appear optimistic about what the new tariffs could mean for the domestic industry — especially if other countries — including China — retaliate. China's strict import contamination standards officially went into effect March 1.
"If anyone in the waste industry was hoping China was going to back off the waste ban, the Trump Administration’s imposition of tariffs on steel and aluminum should dissuade them from that unrealistic dream," David Biderman, CEO of the Solid Waste Association of North America told Waste Dive in an email.
In a March 1 spending report, the Associated General Contractors of America (AGC) said the higher prices resulting from the tariffs could stymie much-needed infrastructure investment and undercut the administration's efforts to get the president's $1.5 trillion infrastructure program underway.
