Texas company gets no steel tariff exemptions for imports from Turkey

Fuel Fix:

The Trump administration denied a steel pipe manufacturer in Baytown a temporary exemption on steel tariffs, but the company has vowed to continue the fight in an effort to reduce the cost of importing pipe from its parent in Turkey.

Borusan Mannesmann Pipe US learned last week that its application had been denied amid objections from some of its competitors. The company filed for a two-year exemption last month and sent postcards to Trump, Gov. Greg Abbott and other high-level officials explaining that company faced substantially higher import costs as a result of the steel tariffs.

Trump in March imposed a 25 percent import tax on steel and a 10 percent import tax on aluminum on most countries and extended them in June to Mexico, Canada and the European Union.

Joel Johnson, Borusan Mannesmann's U.S. CEO, said his company had already faced higher import costs as a result of the tariffs and could see annual shipment payments increase by as much as $35 million if the measures remained in place. In exchange for a temporary exemption, he told the administration that his company would invest $75 million in a second Baytown facility that would allow it to cease imports from Turkey.
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It is not clear why the offer of building a new plant and reducing the need for imports was not acceptable.  It would seem to fit Trump's long-term objective.  The other alternative would be for Turkey to reduce its tariff's on US goods coming into that country.  It also should be in the long-term interest of the US to get the pipelines finished so it can increase exports of oil from the Permian Basin.