The Section 232 tariffs applied to US aluminium imports from Canada have again been removed - just 40 days after the reintroduction of those duties was announced, the Office of the United States Trade Representative (USTR) said on Tuesday September 15.
The reinstated duties, which were announced on August 6, took effect on August 16; with the retroactive ruling, the tariffs were effective for just over two weeks, according to Fastmarkets’ calculations.
According to the USTR, the decision was motivated by expectations that Canadian shipments of aluminium to the United States will decline to 83,000 tonnes in September, 70,000 tonnes in October, 83,000 tonnes in November and 70,000 tonnes in December.
Six weeks after the end of each month, the US will determine whether shipments have exceeded those forecast volumes. If shipments surpass 105% of those volumes, the US will impose the 10% tariff retroactively on shipments made in that month.
Fastmarkets’ aluminium P1020A premium, ddp Midwest US spiked after the duty reinstatement was announced last month, jumping by 43.5% to 16-17 cents per lb on August 7 from 11-12 cents per lb previously.
Market participants were uncertain about the effect the duty removal would have on the premium, however. Some expected it to fall significantly and immediately, while others predicted it would stay flat or even rise further.
Fastmarkets last assessed the premium at 15-16 cents per lb on September 15.
(Editor’s note: This story has been updated to include additional feedback from market participants.)