With the one-year anniversary of Russia’s military operation in Ukraine soon approaching, the US is far from easing pressure on Moscow.
According to Bloomberg, which cited people familiar with internal discussions, Washington is planning to impose a 200% tariff on Russian aluminum imports sometime this week. The Biden administration is making the move not only to further impede Moscow’s war machine, but also because the Russian-made metal is being dumped on US markets substantially below cost, creating undue hardship on US-based aluminum makers.
The White House has been mulling the tariff since October, but at the time held off on making such a rash move as it would likely increase global aluminum prices and wreak havoc across markets. Moreover, a staggering 200% tariff would create undue hardship on consumer products, which are already undergoing elevated prices thanks to a broader surge in inflation.
According to data from the US Commerce Department, US imports of Russian-made primary aluminum equalled approximately 192,000 metric tonnes, equating to just over 5% of the total 3.64 million metric tonnes the US imported in 2021. Given that American industries are primarily focused on downstream aluminum processing such as rolling and die casting rather than extracting the metal themselves, the US economy is heavily reliant on imports; US Geological Survey data shows that the domestic primary aluminum production reached only 880,000 metric tonnes in 2021.
This is not the first time Washington has targeted Russian aluminum. Back in April, US President Joe Biden signed a bill to increase duties on Russian metal imports, resulting in an 18.5% duty rate on unwrought alloys and non-alloy aluminum, and an 11% duty on high-purity aluminum.
Shares of US aluminum maker Alcoa Corp (NYSE: AA) were down 1.23% Monday morning.
Information for this story was found via Bloomberg, S&P Global, and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.