Three tire-cord manufacturing companies with operations in Arkansas are warning that they will be forced to shut down and fire hundreds of workers if President Trump’s Commerce Department doesn’t grant them an exemption from his new tariffs on steel and aluminum imports.
Arkansas Online reports that Bekaert Corp., Kiswire America and Tokusen USA, have jointly requested an exemption on “grade 1078 and above wire rod for tire cord.”
The three companies argue that U.S.-based steel producers are unable to manufacture the quality their companies require.
“Stated simply, U.S. wire rod producers are incapable of producing grade 1078 and above wire rod to produce tire cord because that grade of wire rod must be produced in basic oxygen furnaces to achieve the strength, cleanliness and other properties to draw the wire rod to tire cord dimensions,” lawyers for the three companies told Arkansas Online.
Arkansas Online notes:
But the Wire Rod Coalition, a trade organization of U.S. producers of carbon and alloy steel wire rod, disagrees and has filed an objection to the request for a blanket exclusion.
Coalition members say they can and do make the same quality steel tire cord without using the basic oxygen, or blast, furnaces that Bekaert, Kiswire and Tokusen say their steel requires. “Grade 1078 and above tire cord wire rod can be and is produced using electric arc furnace steel,” the coalition’s legal counsel, Kelley Drye & Warren, said in a formal objection.
The fight over the exclusion request is being waged within the Bureau of Industry and Security, an agency of the U.S. Department of Commerce that describes itself as “a licensing, regulatory and enforcement agency that advances U.S. national security, foreign policy and economic objectives.”
“Grade 1078 and above tire cord wire rod can be and is produced using electric arc furnace steel,” an attorney for the Wire Rod Coalition wrote in a formal objection.
President Trump’s administration last week imposed tariffs of 25 percent on steel and 10 percent on aluminum from the European Union, Canada and Mexico, which together supply nearly half of the United States’ imported metal and are counted among the United States’ closest allies. The tariffs also target China.
“Let me be clear: These tariffs are totally unacceptable,” Canadian Prime Minister Justin Trudeau said at a press conference last week.
“Canada is a secure supplier of aluminum and steel to the U.S. defense industry, putting aluminum in American planes and steel in American tanks,” Trudeau added. “That Canada could be considered a national security threat to the United States is inconceivable.”