Nov 15, 2018
Post by Freedom Partners
Tariffs work only for a few politically connected industries at the expense of most consumers and businesses. Economists have been saying it for years; history has shown it over and over.
Trade restrictions on America’s trade partners are guaranteed to have negative effects on domestic businesses. Here’s a running list of how Americans are already being hurt by tariffs:
Aluminum Tariffs to Cost This Small Brewer $30,000
Nov. 8, 2018: The Washington Post published an article highlighting how tariffs on imported aluminum are hurting the American beer industry.
According to the Beer Institute, tariffs on imported aluminum could increase the cost of beer production by $347 million. Cap May Brewing Co., a small brewery in southern New Jersey, expects tariffs will cost the company $30,000 — no small amount for a small brewery.
“We could get a lot of miles out of that,” Ryan Krill, the brewery’s co-founder and chief executive, said of the money lost. “It’s a bit of a bummer.”
BMW Might Take Its Show on the Road — to China
Nov. 7, 2018: Roadshow published an article about how tariffs are forcing BMW to consider moving more production to China.
BMW is set to make a final decision in the coming weeks about which models of its crossovers and SUVs to start producing in China. Tariffs are expected to reduce the automaker’s 2018 earnings by about $344 million.
“If the tariffs undermine the competitiveness of BMW production and sales in the US,” said BMW, “the result could be strongly reduced export volumes with negative effects on investments and jobs in the U.S.”
What do Lobster Fishermen and Farmers Have in Common? Harmful Tariffs
Nov. 5, 2018: The Nation published an article about how tariffs are hurting a broad range of industries, from lobster on the coast to agriculture in middle America.
Lobster is one of nearly 200 American seafood products China has levied tariffs on in retaliation for the Trump administration’s tariffs. Also on that list is a host of other American agricultural products, including soybeans. China is the largest export market for American soybeans, and the price has decreased 20 percent since tariffs were announced in July.
“This came at a time when farmers had already been experiencing dropping incomes for five years,” said Aaron Heley Lehman, president of the Iowa Farmers Union, who farms 550 acres of corn, soy, oats and hay. “One commodity that we were breaking even or maybe even making a little bit of money on was soybeans. The last crop that was making us some money was put at the front of the trade disputes.”
Soybean Exports Down 94 Percent
Nov. 5, 2018: The Hill published an article highlighting soybean farmers.
U.S. soybean exports to China, the article said, are down 94 percent in 2018, a result of retaliatory tariffs levied on the United States by China.
“I’m trying to follow and figure out who the winners are in this tariff war,” said Greg Gebeke, who farms 5,000 acres outside of Arthur, North Dakota. “I know who one of the losers are and that’s us. And that’s painful.”
American Businesses Spent $800 Million on U.S. Tariffs on Chinese Products in September
Nov. 5, 2018: CNBC published an article highlighting how tariffs are costing American businesses billions more this year than they did last year.
In September, American businesses paid $4.4 billion in tariffs. That’s more than a 50 percent increase from the same month in 2017. That includes $545 million for steel and aluminum imports and $800 million on Chinese products.
“As costs go up, we can’t pass all that to our customers, so that impacts our bottom line,” said Bill Yeargin, chief executive of Correct Craft, a powerboat manufacturer. “And then as markets shut down in Europe and Mexico and Canada, that reduces our sales.”
Tennessee’s Ole Smoky Moonshine Watches Profit Margin Dim
Nov. 2, 2018: ABC News published a news package showing how tariffs are hurting Tennessee whiskey makers.
The Trump administration’s tariffs on steel and aluminum imports hit Ole Smoky Moonshine immediately, since the company’s products are made with metal lids.
Tennessee whiskey also ended up on the list of retaliatory tariffs — some 50 percent of Tennessee whiskey is exported. But Ole Smoky Moonshine decided not to pass the additional costs onto customers.
General Motors Looks to Buy Out Workers
Oct. 31, 2018: The Detroit News published an article about how General Motors is offering to buy out employees to save money, due in part to the cost of tariffs.
GM warned the Trump administration in June that tariffs could lead to fewer jobs and lower wages for Americans working in the American auto industry.
In North America, 18,000 salaried employees are eligible for the buyout.
Tariffs Could Make Crowlers a Poor Investment for Brewers
Oct. 31, 2018: CBS Denver published a news package highlighting how tariffs are threatening one Denver-based craft brewer.
Brewers have begun investing in crowlers — 32-ounce, resealable aluminum cans in which craft beer can be sold to customers. But the Trump administration’s 10 percent tariff on aluminum imported from Canada threatens to hike raw material prices.
“If the actual vessel goes up, then certainly it will affect our business,” said Willy Truettner, co-owner of Zuni Street Brewing in Denver’s Highlands Neighborhood. “We would see an increase and that would eventually pass on to the customer.”
Tariffs Are Harming Business for Farmers in Delaware
Oct. 30, 2018: The Dover Post published an article describing how Chinese tariffs on American soybeans are affecting farmers in Delaware.
In 2012, Delaware soybean farmers earned an average of $14.40 per bushel. Now, per-bushel rates sit at around $7.20. And even at those low rates, some farmers can’t move any product because the tariffs make them expensive for Chinese buyers to import.
“There are places in this country where they’re running out of storage space for soybeans,” said Richard Wilkins, a former chairman of the American Soybean Association. “Normally China would be loading ships as fast as they could to send to their markets. But this year they’re not buying.”
Tariffs Causing Weak Links in the Auto Supply Chain
Oct. 29, 2018: Crain’s Detroit Business published an article highlighting automakers and how they are struggling with supply chains in the wake of tariffs.
Tariff-driven increases in the cost of domestic steel and aluminum are forcing suppliers to adjust how and where they’re purchasing raw materials. This has a ripple effect throughout the supply chain for automakers.
“It’s difficult, if not impossible, to fund the cost of those tariffs as well as technology development to localize that production,” said Ramzi Hermiz, chief executive of metal parts maker Shiloh Industries Inc. “We need a window of time to … redefine our supply chain.”
American Agriculture Is Losing Ground
Oct. 22, 2018: Successful Farming published an article detailing the wide-ranging impact of the trade war on American agriculture, affecting a host of products such as vegetable juice, leather goods, peanut oil, smoked and salted beef, wine and bourbon.
“We continue to work with the USDA Foreign Agricultural Service to expand other markets,” said Chase Adams, senior policy and information director of the American Sheep Industry. “That is ongoing, in good times and bad. The more markets we have, the more flexibility we have in times like these. But this is a big market for us. A swift resolution would be welcome.”
Trade War Cost Texas Companies More Than $654M
Oct. 18, 2018: The Dallas Morning News published an article about how Texas companies paid $654 million more for tariffs in summer 2018 than they did in summer 2017.
According to a recent report, the year-over-year, 142 percent increase came as a direct consequence of U.S. trade policy and the tit-for-tat tariff response of our trading partners.
“This affects our bottom line,” said Texas Ale Project president Kat Thompson, explaining how the aluminum tariffs are hitting her company’s beer cans. “You may think, ‘OK, a one-cent increase on a can, whoop-de-doo.’ But it adds up real fast when you’re talking about 100,000 cans.”
Tariffs Loom Over Baton Rouge Steel Industry
Oct. 17, 2018: Business Report published an article highlighting how tariffs on steel and aluminum are harming Baton Rouge’s steel industry.
“Just think about all the steel that goes into the new Sasol facility over in Lake Charles,” said Greg Bowser, president of the Louisiana Chemical Association. “You add 25 percent to the cost of that steel and you don’t build that project here. It goes somewhere else. We hope that they will find another way to address this issue because it’s going to create some economic problems for our industry and state.”
North Dakota Dairy Farm Utterly Challenged by Tariffs
Oct. 17, 2018: KXMB-TV published a news package featuring North Dakota-based Northern Lights Dairy, which was already part of a challenging industry before tariffs made market conditions worse.
One-seventh of all domestically produced dairy is exported. The report said North Dakota dairy producers see a direct impact as a result of tariffs.
“The dairy industry has probably been on a minimal profit, break-even profit level, up and down for the last three years,” said Kenton Holly, part-owner of Northland Lights Dairy Farms, “especially in last 9-10 months has been mostly below break-even.”
West Virginia, We Have a Problem
Oct. 15, 2018: The West Virginia State Journal published an op-ed, authored by the executive director of the West Virginia Aerospace Alliance, Thomas O’Neill, lamenting the harm the Trump administration’s tariffs have inflicted on West Virginia’s aerospace industry.
The state’s aerospace companies have an economic impact of over $1 billion in North Central West Virginia alone, employing thousands with jobs paying an average salary of over $72,000 per year. But the administration’s tariffs on foreign aluminum and aluminum parts threaten to put a strain on the industry — and the jobs it supports.
“The negative economic blowback facing these West Virginia companies is compounded by the fact that their sister business units based in Canada or Europe are not faced with similar tariff-based headwinds,” O’Neill wrote. “West Virginia’s operations for these multinational enterprises become less competitive than their corporate siblings.”
North Dakota Soybean Farmers Suffer from Trade War
Oct. 13, 2018: The Washington Post published an article detailing the difficulties North Dakota soybean farmers are encountering because of the trade war between the United States and China.
Monte Peterson farms 4,500 acres of land, representing millions of dollars of soybeans. The unseasonably wet weather, which arrived early this year in North Dakota, has prevented Peterson and his four-man crew from harvesting the soybeans. He needs to complete this project by Halloween.
But there is another lingering issue. Steep Chinese tariffs on American soybean imports, imposed as retaliation for U.S. tariffs, leave Peterson bereft of a buyer for his crops. Even if Peterson’s crew completes its harvest on time, it will have trouble finding a foreign buyer.
“What does a farmer do to respond to that when we’re in the middle of a growing season? We can’t just go out and rip up the crop and find something else to sell,” Peterson said. “It’s not like we’re creating widgets here. You can’t just speed up or slow down the production line.”
Tariff Costs Exceed Those of Affordable Care Act
Oct. 11, 2018: The Washington Examiner published an op-ed on the immense cost of the Trump administration’s tariffs, noting that the National Taxpayers Union Foundation found that they now cost Americans more than the tax bill for the Affordable Care Act, also known as Obamacare.
While the NTUF estimates the total annual costs of these tariffs at nearly $42 billion, the total price tag on the ACA for next year is estimated at $34.6 billion. The NTUF also estimates that the total burden of trade taxes will reach nearly $133 billion, more than 70 percent of the $188.8 billion in 2019 individual income tax cuts.
“President Trump has done good things in some areas of taxation, such as reducing the tax burden through tax reform and making American corporations more competitive on the international level,” the author concluded. “He should not undo this progress by hitting American consumers with trade taxes that nearly wipe away those gains.”
Tariffs Throw a Wrench in Wisconsin Tool Company
Oct. 11, 2018: The Seymour Daily Tribune published an article detailing how Wisconsin-based manufacturing firms are bracing for an elevated trade war as the Trump administration ratchets up tariffs against Chinese goods.
Johnson Level and Tool, based in suburban Milwaukee, is preparing for the impact of additional tariffs, which they project would add up to $3.7 million in extra costs for the company. The question now being weighed by many companies is whether to raise the prices of their products — likely scaring off potential customers — or absorb the costs of the tariffs, which would take a large slice of their revenue. Either route runs the risk of lower profits and lost jobs. Factored into this equation is how long, exactly, these tariffs will last. Of that, no one is sure.
Johnson Level has chosen to raise prices by 8 to 10 percent. Paul Buzzell, the company’s chief financial officer, said he has already spoken to customers who were put-off by the price increases. Many vowed to find another supplier.
Land O’Lakes CEO on Harm Caused by Tariffs
Oct. 1, 2018: CNN’s Poppy Harlow interviewed Land O’Lakes CEO Beth Ford on CNN Money and discussed how tariffs were harming the farmers from whom the company purchases crops — soybeans, in particular.
Ford noted that the soybean farmers with whom Land O’Lakes conducts business are worried about the loss of market access they will incur as a result of retaliatory tariffs implemented by China, in response to the Trump administration’s tariffs on Chinese goods. Coupled with market uncertainty and chaotic supply chains, the tariffs are making investment and planning for the future more difficult for Land O’Lakes and their farmers.
“They don’t want any government handouts,” Ford said, referring to Land O’Lakes’ partnered soybean farmers. “They want market access — that’s critical for a grower. That’s critical for a producer.”
Grain, Grain Everywhere
Oct. 1, 2018: The Associated Press reported that Indiana agricultural officials are worried that the Trump administration’s tariffs, along with higher-than-average grain yields this year, will create grain storage problems in the state.
With low prices and reduced market access, many producers were unable to sell their grain, forcing them to keep their product in storage. Some grain elevators have 25 percent of their capacity in leftover grain.
Pennsylvania Plant Struggles to Keep Canadian Customers
Oct. 1, 2018: Lehigh Valley Business published an article highlighting how tariffs are hurting several Pennsylvania businesses, including Hydro-Extrusion North America, a company that works with aluminum.
Hydro is an international business, employing some 1,100 at its large plant in Cressona where it produces soft alloy aluminum extrusions. The company’s products are found in nearly every vehicle. Tariffs create price uncertainties, which makes for a difficult business environment.
We are not really supportive of [these tariffs] because it distorts the supply chain,” said Mike Hammer, a plant manager. “We’ve lost business and it’s primarily with our Canadian customers.”
Tariffs Make Construction Industry Bear Load
Oct. 1, 2018: The Dallas Morning News published an article describing how tariffs are negatively affecting residential construction.
In 2017, the industry imported more than $21 billion worth of Chinese products and $45 billion from other countries. But tariffs are also hurting developers and commercial construction companies.
“You are going to see a price increase,” said Grant Pruitt with Dallas commercial property firm Whitebox Real Estate. “The challenge we are having is all the prices keep going up, up, up.”
Tariffs a Club Over the Head
Sept. 30, 2018: The Daily Republic published an article by The Washington Post highlighting how tariffs on Chinese imports are harming one Chicago-based CB radio company.
For decades, Cedar Electronics has been selling American truckers CB radios. The products, though, have been manufactured in China and were hit with one of the Trump administration’s 25 percent tariffs. These rising costs are forcing American companies to consider uprooting their plants, implementing layoffs, hiking prices and cutting investments.
“We are looking as fast as possible to find an alternative (manufacturing) place, but we’re dealing with a very unstable situation,” said Cedar Electronics Vice President Mark Karnes. “As a business, my government just clubbed me over the head.”
Bike Prices See Incline
Sept. 27, 2018: WTMJ-TV published a news package highlighting how tariffs are increasing the retail cost of bicycles.
Both bicycles and bicycle parts are affected by the Trump administration’s tariffs on $200 billion of Chinese goods.
“A lot of the accessories as well, which have already kind of gone up, but those have been little bits and pieces,” said Karrie Timm, vice president at Extreme Ski & Bike in Thiensville, Wisconsin. “The bikes have gone, they’ve gone full across the board price increase.”
Iowa Farmers See Costs Go Up, Income Go Down
Sept. 27, 2018: The Gazette published an article featuring two Iowa farmers who are being harmed by the Trump administration’s trade war.
“Our income is going down and our costs are going up,” said John Gilbert, a Hardin County livestock, dairy and grain farmer.
“Workers are going to be laid off when farmers don’t have enough income to do anything more than meet their bank payments, if they can do that,” said Bruce Rohwer, who raises corn, soybeans and hogs in O’Brien County.
Tariffs Drive Ford to Lose $1B
Sept. 26, 2018: Reuters published an article featuring Ford Motor Co., which says tariffs have cost the company $1 billion.
Tariffs on foreign-made steel have caused domestic prices to skyrocket, due to higher demand and less competition.
“From Ford’s perspective the metals tariffs took about $1 billion in profit from us,” said Chief Executive Officer James Hackett. “The irony of which is we source most of that in the U.S. today anyway. If it goes on any longer, it will do more damage.”
Nebraska Business Worries Tariffs Could Raise Prices
Sept. 25, 2018: The National Retail Federation (NRF) issued a press release on the appearance of Ron Romero during Trade Builds America, an event/panel co-hosted by Americans for Prosperity, Freedom Partners Chamber of Commerce, NRF, and several other pro-trade advocates.
Romero owns Schaefer’s TV and Appliance, an independent retail business in Lincoln, Nebraska. He worried that tariffs would force him to raise the prices of his goods, driving away customers and slowing the growth of his company. Schaefer’s TV and Appliance employs more than 90 Nebraskans, whose jobs could be jeopardized by the tariffs. More tariffs would worsen that situation.
“We were only given a week’s notice in some cases to prepare for this latest tariff onslaught that couldn’t have come at a worse time as we approach the holiday shopping season, a very important selling season of the year,” Romero said.
Aid Won’t Cover the Loss of Trade
Sept. 27, 2018: The Wall Street Journal reported that the Trump administration has begun compensating farmers for the damage tariffs have done to their businesses. Many farmers have already said that the administration’s compensation is insufficient to cover the loss of sales to China.
The aid comes amid a large drop in prices for farm commodities. According to the Department of Agriculture, U.S. farm income is expected to drop 13 percent in 2018. Prices for hogs have dropped 19 percent since the end of May.
Iowa Agriculture Taking Flak from Trade War
Sept. 18, 2018: CNBC published an article detailing the worries of Iowa’s Department of Agriculture over the Trump administration’s newest round of tariffs, an additional 10 percent on $200 billion of Chinese imports. Those duties will jump to 25 percent Jan. 1.
Iowa Agriculture Secretary Mike Naig said Iowa farmers have already been hurt by China’s retaliatory tariffs — which slapped duties on U.S. soybeans, corn, wheat, dairy products and on pork products, which now exceed 70 percent — levied in response to those imposed by the Trump administration. China’s duties levied on American pork have been particularly harmful for Iowa farmers: About a third of the country’s pork is raised in Iowa.
“It is impacting our markets and that’s impacting our farmers,” said Naig. “Our farmers understand that there are issues that need to be resolved, particularly with China. But there is no doubt that the retaliatory tariffs are impacting our marketplace and that’s impacting our producers negatively.”
Tariffs Shelling California Pistachios, Other Agricultural Producers
Sept. 19, 2018: The Wall Street Journal published an op-ed on the significant economic hit California farmers are taking from China’s retaliatory tariffs on U.S. agricultural goods.
California pistachio, almond and wine producers have found a reliable clientele among affluent young Chinese. But due to Chinese retaliatory tariffs, including a 40 percent tariff on American wine, many are finding it harder to sell their products to China. These retaliatory tariffs, coupled with a severe water shortage in the state, are making it difficult for California farmers to keep their heads above water. With China’s new round of incoming tariffs, some may go under.
One pistachio grower, Lawrence Easterling, has already taken a sizeable hit from tariffs. Three years ago, he was able to sell his pistachios at $3.77 a pound. This year, that price dropped by nearly $2, to $1.80. He expects the price to drop even further. “Under these conditions, we will lose money,” Easterling said.
Tariffs Adding Stress to Hurricane Season in Florida
Sept. 20, 2018: The Palm Beach Post published an article highlighting how tariffs on aluminum are making hurricane season even tougher in Florida.
Floridians know to order their hurricane shutters well in advance of storm season. One luxury home in Palm Beach Gardens ordered $40,000 shutters in April, expecting them to arrive in May. However, tariffs have made aluminum prices increase and supply dwindle, causing products to take four-times as long to be delivered.
“Things are starting to catch up,” said Andy Kobosko Jr., owner of Guardian Storm Protection in suburban West Palm Bach, “but it’s been a stressful three months.”
Tariffs Raise Connecticut’s Homebuilding Prices by $10K
Sept. 11, 2018: Connecticut’s NewsTimes published an article depicting how, in the wake of the Trump administration’s tariffs on lumber, certain types of wood have seen a 24 percent price increase over the last 16 months. This has added $10,000 onto the cost of building a median-priced home in Connecticut. Softwood accounts for some 10 percent of homebuilding costs and, right now, it’s priced at almost an all-time high.
Wisconsin Fence Business Hit with Triple-Whammy
Sept. 10, 2018: The Capital Times published an article featuring Wisconsin business owners, including Ray Statz. His business is being harmed by tariffs on steel, aluminum and lumber.
Statz founded Qual Line Fence in Waunakee in 1956. He and some 16 employees build about 500 fences each year, made from steel, aluminum and cedar. Statz estimated that, since the beginning of the year, material costs have risen by as much as 30 percent.
“It makes me lose some sleep at night,” Statz said. “It makes it difficult. We’re supposed to take a gamble and wonder what the future’s going to be by next spring. It’s not the good old days.”
Hometown Sheds Scrambling for Cover Due to Rising Prices
Sept. 6, 2018: A local ABC News affiliate in South Carolina reported that a Conway-based shed retailer has had to raise its prices by 20 percent due to the administration’s steel and lumber tariffs introduced in March of this year.
The materials are critical input goods for Hometown Sheds, which in response raised prices significantly — by 20 percent — in early August, in a break with previous years.
“If they’re gonna increase this dramatically for a shed, I can’t imagine how dramatically they’re gonna increase for the homeowners,” retailer Colin Brown said.
Tariffs Not-So-Brilliant for Start-Up
Sept. 6, 2018: CNBC published an op-ed by Aaron Emigh, the founder of home automation start-up Brilliant Home Technology. The company is based in the United States. But because its manufacturing occurs in China, the start-up has been harmed by tariffs.
When the administration announced 10 percent tariffs on $200 billion of Chinese products, Brilliant’s products were impacted.
“With no time to move our supply chain, we were forced to raise our prices. No sooner had we done so than the tariff rate was abruptly increased to 25 percent,” Emigh wrote. “We felt that we could not raise our prices further without pricing ourselves out of our market.”
Vermont Manufacturer Hit by Multiple Tariffs
Sept. 5, 2018: The Burlington Free Press published an article highlighting how Vermont businesses are struggling to deal with the administration’s tariffs. One of those companies is Colchester-based Hazelett Corp., one of the largest manufacturers in Vermont.
Hazelett makes continuous casting machines that are used to manufacture rolls of aluminum and copper, as well as copper bar and strips of zinc and lead. The company has customers all over the world, including China. But China’s retaliatory tariffs, which impact Hazelett products, are scaring away Chinese customers. The Trump administration’s tariff on Canadian aluminum is also hurting the company.
“The tariffs have brought a lot of shocks, but the biggest one and worst one is this 10 percent tariff against Canadian aluminum,” said David Hazelett, grandson of the company’s founder. “It’s a tax on American costs that nobody else bears, only the United States.”
Tariffs Amp Up the Pressure for Audio Equipment Company
Sept. 3, 2018: National Review published an opinion column detailing the effects of the administration’s tariffs on a Massachusetts-based audio equipment company.
Bricasti, headed by Brian Zolner, has been in the business of producing high-quality, handmade audio equipment for four decades, and boasts clients from all over the world, including John Mayer. But the administration’s tariffs, coupled with retaliatory tariffs from abroad, are hitting the company hard. Already, their metal costs have risen by as much as 50 percent. They will have to split the difference between raising prices and absorbing the costs.
The tariffs have made international supply chains very unpredictable, making imports of Bricasti’s input parts much more difficult to acquire. “We’ve had open orders with our vendors for thousands of parts. Last month they said we don’t know how and if we can deliver,” Zolner said.
Maine’s Lobster Industry Pinched by Trade Dispute
Sept. 3, 2018: Maine’s local WGME news reported that the Trump administration’s tariffs are putting a real pinch on Maine’s lobster industry.
This summer, in response to the administration’s tariffs, China applied a 25 percent tariff to lobsters from the United States. The Lobster Co., headed by Stephanie Nadeau, has had to lay off a quarter of its employees as it loses market share to Canada’s lobster industry.
Tariffs Put Jack Daniel’s on the Rocks
Aug. 29, 2018: The Wall Street Journal reported that Jack Daniel’s, one of America’s most popular whiskey producers, is cutting its profit forecast due to uncertainty from tariffs.
In retaliation to the administration’s tariffs, the European Union has levied tariffs of their own on, among other things, American whiskey. Brown-Forman Corp., which owns Jack Daniel’s, estimates that it will lose 10 cents per share in annual profit — approximately $50 million.
China Picks Cherry Farmers for Tariff Retaliation
Aug. 29, 2018: The Wall Street Journal editorial board expressed concern for American cherry growers, who are being harmed by the trade war between Washington and China.
The combination of Chinese retaliatory tariffs and a questionable inspections process have caused cherry growers, particularly in the Pacific Northwest, to take a considerable hit. The Northwest Horticultural Council estimated that the region’s growers lost $86 million over the summer.
“With farming in general, there’s a lot of stress because of things you can’t control, like weather,” said Chris McCarthy, CEO of Auvil Fruit Company. “This is something that’s very controllable by our government. Growers like Auvil aren’t going to be the beneficiaries of a trade war. But we’re paying a tremendous price.”
Tennessee Town Threatened by Multiple Tariffs
Aug. 26, 2018: The Citizen Tribune published an article highlighting how tariffs could hurt the people of a Tennessee town once known for its booming manufacturing industry.
Furniture manufacturer Daniel Paul Chairs is facing uncertainty in the marketplace due to tariffs, since it uses imported parts to assemble its products and relies on lumber, which is now harder to acquire, thanks to tariffs. MAHLE, an automotive parts manufacturer, has been hit by the tariff on aluminum and another on components imported from China. So far, both tariffs have cost MAHLE nearly $2 million.
“Right now, there is no solution,” said Jim Sexton, senior director and plant manager of MAHLE. “With the impacts that are potentially out there, if the taxes are maintained long-term, you could see the slowdown in automotive, which would affect not just us, but all the Tier 1 suppliers in Morristown.”
Newspapers in Danger of Folding Under Pressures from Tariffs
Aug. 24, 2018: The Washington Post published an article highlighting multiple newspapers that have suffered under the administration’s tariffs on imported newsprint.
The Tampa Bay Times, the Pittsburg Post-Gazette, Iowa’s Storm Lake Times, more than 24 regional newspapers under McClatchy Newspapers and many others have needed to take measures to deal with rising paper costs. They’ve laid off workers, reduced publication and reduced the number of pages in each edition.
“You might be able to absorb [higher costs] if the rest of the business was going swimmingly,” said Paul Tash, chief executive of the Tampa Bay Times, “but this is a tough environment for newspapers.”
Apparel Industry Fears Another Round of Chinese Retaliatory Tariffs
Aug. 24, 2018: CNBC published a news package featuring Rick Helfenbein, president and chief executive at American Apparel and Footwear Assocation, discussing how tariffs are harming the industry.
Helfenbein said that 41 percent of all apparel, 72 percent of all footwear and 84 percent of all accessories are imported into America from China. If China retaliates against the Trump administration’s latest round of tariffs on an additional $16 billion of Chinese imports, that could be a major blow for the clothing industry.
“What’s going to happen down the road is very simple — prices will go up, sales will go down, jobs will be lost,” Helfenbein said. “This will have a negative impact on the economy.”
Tariffs Raising Consumer Prices
Aug. 20, 2018: Forbes published an op-ed detailing how the Trump administration’s tariffs have reduced the number of imports for a select few goods, while simultaneously raising the prices of those goods for Americans, who have footed the bill for these trade barriers.
While imports to the United States rose over the past year, and many prices for goods dropped, it appears that tariffs on a select few goods — washing machines, for example — have both increased their costs and reduced their importation, hurting American consumers. Tariffs on washing machines were implemented in Feb. 2018. Since then, the price of washing machines at the consumer level jumped more than 16 percent.
“The available data on the global tariffs,” Ken Roberts wrote, referring to washing machines, “makes two compelling points. Imports will fall. Americans will pay the price.”
Proposed Tariffs to Deal Harsher Blow to Consumers
Aug. 20, 2018: CNBC reported that a host of U.S. businesses will be spending the week in Washington urging the de-escalation of the trade conflict with China, arguing that proposed 25 percent tariffs on $200 billion of Chinese goods will hit American consumers hard.
This proposed round of tariffs will impact a wide variety of Chinese products, including seafood, furniture and lighting products, tires, chemicals, plastics, bicycles and car seats for babies. While previously-levied tariffs were targeted more toward industry, this round of tariffs would be more directed at consumers.
The U.S. Chamber of Commerce weighed in, stating that these “tariffs on an additional $200 billion of Chinese imports dramatically expands the harm to American consumers, workers, businesses and the economy.”
New Jersey Businesses Between a Rock and a Hard Place
Aug. 18, 2018: The Associated Press reported that New Jersey businesses have been feeling pinched by the steel and aluminum tariffs implemented by the administration.
The response from many New Jersey lawmakers has been to suggest relief in the form of tax credits to the afflicted companies, but the proposal hasn’t seen much of a push. In the meantime, many New Jersey businesses are worried that the rising costs of imported goods will force them to “swallow” these expenses — or pass them to consumers, with the expectation that foreign companies will quickly out-price them.
“I cannot get the material we need manufactured here in the U.S.A.,” said Marcia Frieze, the CEO of Case Medical, which manufactures medical instruments and containers.
Aug. 16, 2018: Bloomberg published a business report detailing how, under the administration’s tariffs, it has become more expensive for Americans to buy auto parts and perform repairs on their vehicles.
Tariffs on imported steel and aluminum, along with those on auto parts, are raising the costs of personal car repair. AutoZone Inc. and O’Reilly Automotive Inc. plan to raise prices on a host of goods they carry, including tires, rear-view mirrors, windshields and windshield wipers.
“They are going to have to pay that extra cost in the end because we’re not going to eat it, that’s for sure,” said Chris Lynch, owner of Wetmore Tire and Auto in Ferndale, Michigan.
Popcorn Takes a Punch
Aug. 16, 2018: ABC’s Nebraska affiliate reported on Norm Krug’s popcorn company, Preferred Popcorn, and its difficulties storing grain in the middle of the administration’s trade war.
Foreign retaliatory tariffs, in response to the Trump administration’s tariffs, have raised the price of American corn abroad, particularly in China. Now, instead of shipping his corn to China, Krug is keeping his grain in storage. He calls his grain bins “tariff bins.” In a few weeks, Nebraska Gov. Pete Ricketts is heading to Mexico on a trade mission, hoping to work out a new free trade deal.
“Mexico and Canada are our two biggest trading partners. We want to make sure that we’re continuing to have market access there, we don’t want to disrupt relationships that are so important,” Gov. Ricketts said.
Boat Manufacturers Taking on Water
Aug. 13, 2018: Business Insider published an article explaining the negative effects of tariffs on Correct Craft, an American boat manufacturing company run by Bill Yeargin.
Tariffs have hit Correct Craft from three angles: First, by increasing prices on imported parts, which Correct Craft needs to manufacture its boats; second, because the company sources the aluminum that goes into its boats from the United States, Correct Craft has been hit hard from an increase in domestic prices spurred by protective tariffs; and third, retaliatory tariffs on boats from Canada, Mexico and the EU have hit Correct Craft’s exports hard, making the company less competitive internationally.
“We have found ourselves in the crosshairs of a trade war, one that will drown out the effects of tax reform and risk our industry’s promising future, taking American workers and consumers down with it,” Yeargin wrote in an op-ed for the Washington Examiner.
Crop Export Prices Wither from Tariffs
Aug. 14, 2018: The Hill reported that U.S. crop export prices have fallen at the steepest rate since 2011, declining by a staggering 5.3 percent in July.
Export prices for corn, nuts, wheat, fruit and soybeans declined last month, with soybeans taking a 14.1 percent decrease in prices. While export prices rose marginally for the entire economy, agricultural export prices took a 2 percent hit. The downward pressure exerted on agricultural export prices has prompted the Trump administration to propose a $12 billion aid package to farmers.
But many are looking for more long-term solutions. “Ultimately, resolving trade differences and repairing relationships with our trading partners must be our top priority,” said Mark Recker, president of the Iowa Corn Growers Association.
Tariffs Leave Deep Cut in Small Newspapers
August 9, 2018: The New York Times reported that the administration’s tariffs on Canadian newsprint are putting intense financial strain on small American newspapers, which are unable to keep up with the rising production costs.
Some small newspapers have already cut staff and decreased their production frequency, while at least one has shut down production entirely. In some rural towns, the shutting down of local newspapers means that residents will be disconnected from the happenings of their town.
“There is no question that without a local newspaper, no one is holding officials accountable and serving as the local archives,” said Crystal Dupre, the publisher of The Bryan-College Station Eagle in Bryan, Tex.
In Indiana, Big Layoffs for Jeffersonville Firm
August 3, 2018: Jeffersonville, Indiana’s News and Tribune reported that Brinly-Hardy Co., a Jeffersonville-based company that manufactures lawncare accessories, was forced to lay off 75 employees in response to the administration’s tariffs.
The CEO of Brinly-Hardy, Jane Hardy, has already had to cut salaries for employees and eliminate production shifts. She has told the Washington Post that she can’t raise prices on Brinly-Hardy’s products, as she would easily be undercut by foreign competition. She referred to these tariffs as potentially the “nail in our coffin” for Brinly-Hardy. She said she was unsure the company would survive the fall season.
“We are caught in the middle of this trade battle,” Hardy said. “Our U.S. manufacturing jobs and our 179-year history should not be considered acceptable collateral damage.”
Business Leaders Tread into Uncertain Future
August 2, 2018: Radio Iowa reported that Creighton University’s monthly economic survey of Iowa business leaders found that nearly two-thirds of respondents reported that the Trump administration’s tariffs have had, or will have, a negative impact on their companies.
The survey further found that nearly half of supply managers reported that tariffs have had negative impacts on buying from abroad. Creighton University economist, Ernie Goss, isn’t optimistic that current economic growth will continue at its current pace due to the administration’s tariffs, calling these policies a “clear and present danger” to the economic health of the Midwest.
If these tariffs continue, Goss predicts that they will “push the economy into slower growth territory and inflation.”
“That’s going to push interest rates up,” said Goss.
Tariffs Taken Even Higher
August 1, 2018: Reuters released a news update concerning the Trump administration’s proposal to raise tariffs on goods from China from the initially proposed 10 percent to 25 percent.
These tariffs would apply to a range of Chinese goods, including fish, circuit boards and lighting products, and are certain to raise the prices of a variety of consumer goods for Americans. They would also escalate a growing trade war between the United States and China.
“Given the scope of the products covered, about half of all imports from China are facing tariffs, including consumer goods,” said Erin Ennis, senior vice president of the U.S. China Business Council. “The cost increases will be passed on to customers, so it will affect most Americans’ pocketbooks.”
Tariffs Could Take a Bite Out of Apple
July 31, 2018: CNBC published an article on Apple CEO Tim Cook’s warning that the administration’s tariffs will have “unintended consequences” for American consumers and the economy.
Investors worried that the most recent round of American proposed tariffs could impact Apple’s future pricing and market share in China. The Apple Watch may be among the devices subject to these new rulings.
“…The trade relationships and agreements that the U.S. has between the U.S. and other major economies are very complex, and it’s clear that several are in need of modernizing, but we think that in the vast majority of situations that tariffs are not the approach to doing that,” Cook said on a call with investors.
Coke Canned by Steel and Aluminum Tariffs
July 26, 2018: CBS News published an article detailing how the administration’s tariffs on aluminum and steel will have many customers paying a higher price for their favorite soft drink: Coca-Cola.
Coca-Cola CEO James Quincey announced recently that the company would be raising prices on customers. Though the additional cost on each can of coke may be small, the costs add up for the company. Consumers purchase nearly 2 billion servings of Coca-Cola each day.
“If I was Coke, I’d say that information out there about aluminum being a fraction of the price of a can is false,” said Jeff Inman, professor of marketing and business administration at the University of Pittsburgh.
Kia’s Future Uncertain in Westpoint, Georgia
July 27, 2018: NPR explained in an article the dangers tariffs pose to a large Kia manufacturing plant in Westpoint, Georgia.
The Trump administration’s proposed auto and auto part tariffs threaten the ability of dealers to sell cars and American manufacturers to produce them. Kia is worried that it may have to reduce their number of employees. Westpoint has known hard economic times in the past, when the collapse of its textile industry caused significant unemployment.
“We’ve been through that down time,” said Steve Tramell, Westpoint’s mayor. “We don’t ever want to go through that again.”
Maine Lobster Seller Sees No Sales to China Since Tariffs Kicked In
July 24, 2018: Fox News published an article featuring The Lobster Company in Arudel, Maine, a small lobster distributor with 20 employees. Since Chinese tariffs on American lobster kicked in at the beginning of July, the company is already seeing ill effects.
China consumed nearly 18 million pounds of lobster last year — a record amount. But the country’s new 25 percent tariff on American lobster, which was levied in retaliation for tariffs imposed by the United States, could mean that China’s done buying.
“Fifty percent of what we do here at the Lobster Co. used to go to mainland China. Since, July 6 we’ve sent none,” said Michael Marceau, the company’s co-owner. “It doesn’t just effect my crew. It affects lobster catchers, their crews, the trap makers, the guys that knit heads, the guys that do rope, the guys that do buoys.” Marceau hopes that cutting his employees’ work hours will allow him to avoid layoffs.
Tariffs Mow Down Lawn Equipment Companies
July 24, 2018: Bloomberg published an article featuring Indiana-based Brinly-Hardy Co. The lawn-equipment manufacturer is feeling the brunt of the administration’s tariffs on steel and aluminum.
The tariffs have hiked the company’s raw material costs by some 37 percent — but not because it uses foreign steel. Tariffs make the market less competitive, which encourages domestic steel producers to hike their prices. Brinly-Hardy does import some components and finished products from China, which are subject to 25 percent tariffs.
“We have felt the pain of the current trade war enough,” said Jane Hardy, the chief executive and fifth family member to run the business. Brinly-Hardy has already been forced to fire employees, slash salaries, hike prices and eliminate a second production shift. “Our U.S. manufacturing jobs and our 179-year history should not be considered acceptable collateral damage.”
Chinese Pork Tariffs Affect More Than Just Farmers
July 24, 2018: NPR published a news package featuring Chuck McCarthy. McCarthy runs a cold storage meat warehousing business in North Carolina, and has noticed a big drop-off in sales to China since Chinese tariffs on pork kicked in.
His biggest customer had been sending him sizable loads of pork products every day to ship to China, adding up to more than $100,000 per month. But then, about four weeks ago, “it just stopped.”
“They said their company was not packing anything for China as a result of the political situations that were going on,” McCarthy continued.
Footwear Industry Left Waiting for Other Shoe to Drop
July 24, 2018: The Washington Post published an article highlighting how tariffs are affecting the shoe industry.
Ninety-eight percent of shoes are manufactured abroad. Most of that manufacturing takes place in China. That makes footwear one of the most heavily imported products, and vulnerable to tariffs. So far, shoes have been left off the administration’s list of imports to tax. But with the threat of more tariffs, the industry is rife with uncertainty.
“There’s a real cost to the uncertainty,” said Peter Bragdon, chief operating officer of Columbia Sportswear. “A lot of these things have unintended consequences — the current system of tariffs is bad, but it’s predictably bad. Not knowing week to week what the rules will be makes it difficult to invest.”
Tariffs Have Far-Reaching Impact in Milk Market
July 23, 2018: The Pittsburgh Post-Gazette publishes an article featuring Carissa Itle Westrick, director of business development at Vale Wood Farms in Pennsylvania. Although she serves the local community, her business is threatened by tariffs.
The Loretto-based farm processes its own milk, as well as milk from three neighboring farms within an hour away. “Not one drop” of the farm’s milk, Westrick said, leaves the local area.
“Even though we’re processing our own milk, we have to price our products competitively — especially for wholesale accounts like schools or stores or retirement homes,” she said. “Factors that impact national market prices — export volumes, a strong dollar, potential tariffs — have far reaching impacts in pricing farm products, even locally.”
Tariffs Could Cause Washington State the Most Harm
July 22, 2018: The Columbus Dispatch published an article listing which states could be hurt most by tariffs.
Using data from the U.S. Chamber of Commerce, and its own research, the news outlet found that, in terms of overall exports, Washington State could take the biggest hit. Louisiana, California, Texas and Illinois round out the top five. Agriculture makes up a significant portion of those exports — an important industry for Ohio, who ranks seventh on the list. China hit American soybeans with a 25 percent tariff.
“We’re looking at a $200,000 loss on beans in just the last month and a half,” said Bret Davis, a Delaware County, Ohio, farmer who grows corn and soybeans. “On corn, we have lost another $200,000.”
Wheat Growers Fear Chinese Tariffs Could Cause Damaging Surpluses
July 21, 2018: KELO-TV published a news package highlighting how farmers are bracing for the negative effects of China’s retaliatory tariffs on American wheat.
Wheat is the third-largest crop in the United States and China is the product’s largest customer. The winter wheat harvest is expected to double this year compared to last year. That’s bad news if China cuts back on its purchases. Just the talk of tariffs makes the market react badly. The imposition of tariffs could mean less customers, plummeting prices and product surplus.
“We need our negotiators to go back to the table and hammer those agreements out, so we can stop having our markets react to the negative news every day,” said South Dakota farmer Scott VanderWal. “That’s what sends our markets into gyrations and affects our net income.”
How Tariffs Could Devastate Growers Who Don’t Rely on Exportation
June 19, 2018:CNN published an article featuring Harrison Topp, a fruit farmer in Colorado, who is feeling threatened by increased domestic competition driven by tariffs.
Topp is a first-generation farmer and his business is small. While large businesses focus on international customers, his business focuses on the domestic market. But when other countries place tariffs on agriculture in retaliation for tariffed levied by the United States, larger growers would need to find other customers. If they turn to Topp’s customers, prices in the market will drop and revenue will take a hit.
“It feels really reckless right now. Agriculture is being gambled with,” said Topp.
Tariffs Cost Hog Farmers $2 Billion
July 16, 2018: CBS News published an article featuring Jim Heimerl, an Ohio farmer who has seen tariffs make tight budgets even tighter.
Soybean prices per bushel have decreased 19 percent since early May — a 10-year low. Corn prices are down more than 15 percent. Pork producers are expected to lose more than $2 billion per year.
“That means less income for pork producers and, ultimately, some of them going out of business,” said Heimerl, a pig farmer and president of the National Pork Producers Council.
Tariffs Tanking New Hampshire Lobster Business
July 15, 2018: The New Hampshire Union Leader published an article featuring Amy Shafmaster, manager of Little Bay Lobster Co., who said tariffs have cost her company revenue.
The company had been shipping more than 50 percent of its lobsters to China, about 50,000 pounds a week. But then China imposed a 25 percent tariff on U.S. lobster, and the company now needs to look for new customers in the United States.
“We ship to China every week, and all of a sudden we didn’t have any orders,” manager Amy Shafmaster said. “The Canadian lobster is so much cheaper than the U.S. lobster now.”
Steel Tariffs Handcuff Prison Construction
July 13, 2018: KUTV published an article highlighting how tariffs are costing Utah’s prison project $15 million.
A new state prison in Salt Lake County already had to increase its projected cost from $550 million to nearly $700 million earlier this year, inciting criticism. Now, tariffs on steel will increase the cost of rebar, cells, window frames, roofing and more.
“The tariff is definitely having an impact,” said Jim Russel, director of facilities, constriction and management for the prison. “A facility such as this, it’s almost all steel concrete, so it’s going to be a major concern here.”
American Farmers Beaned by Chinese Tariffs
July 9, 2018: The Washington Times Herald published an article detailing the negative effects of tariffs on Indiana’s soybean and corn producers.
Recently China issued a 25 percent tariff on American soybean imports, in addition to cancelling or reselling shipments already scheduled. The toll is heavy for soybean farmers. Soybean prices are down $1.50. Corn prices are also down 45 cents. Purdue University estimates that a farmer with 1,000 acres of soybeans and 1,000 of acres of corn will lose $160,000 in revenue.
“The value of the crop is taking a beating,” said Ronald Burris, a small farmer in Daviess County. “There could be some trying times this fall. I’m glad I don’t have a lot of debt.”
Farmers and Fishers on the Hook for Tariffs
July 10, 2018: USA Today published a story explaining the effects of tariffs on American industry, particularly in farming, seafood-producing and automobile-manufacturing states.
While Chinese retaliatory tariffs are hitting American businesses across the board, workers in Arkansas, Iowa and Nebraska are getting hit hardest, according to a study from the Brookings Institution. About 1.7 million American jobs are affected by China’s tariffs.
“China is a major market for Alaska seafood and it is also a major reprocessing center,” said Alexa Tonkovich, executive director of Alaska Seafood Marketing Institute. “The seafood industry directly employs nearly 60,000 workers in Alaska each year and directly employs more workers than any other private sector industry.”
20,000 Bushels of Beans and Nowhere to Go
July 9, 2018: The Morning Call published an article highlighting Pennsylvanian soybean farmers who are experiencing blows to their businesses due to agricultural tariffs imposed by China.
In Lehigh Valley, farmers have seen soybean prices drop since the United States imposed tariffs on some Chinese goods in March. Prices continue to dive as China recently imposed a 25 percent tariff on American products, including soybeans.
“The margin of profit is low, real low. It’s borderline if we’re going to make it or not,” said Anthony Rinaldi, a soybean farmer in Forks Township. He has some 20,000 bushels of soybeans but is unable to sell them. “Unless the government comes up with some kind of subsidy program, we’re probably all going to be in trouble.”
Tariff Harm Reaches Many Industries
July 8, 2018: Axios published an article about what different industry stakeholders are saying about tariffs.
From commercial fishermen, to dairy farmers, to metalworkers — tariffs are harming many industries and their hard-working employees.
“I have yet to find an example where tariffs have worked for the long term good of the country that first imposes them,” Jeff Schwager, the president of Wisconsin cheesemaker Sartori Company. “If this is going to go on long term, the customers down there will look for an alternative product without the tariffs on it.”
Tariffs Forcing Soybean Farmers to ‘Tighten the Belt’
July 7, 2018: A news package from NPR featured John Heisdorffer, a soybean farmer in Iowa, describing how farmers spent years building up the Chinese market for American soybeans. Because of tariffs, that’s all at risk.
America exports $14 billion worth of soybeans and associated products to China each year. That’s more than half of all soybean exports. Sixty percent of all American soybeans are exported. Chinese-imposed tariffs on agriculture are expected to hit the soybean industry hard. What will Heisdorffer do to prepare?
“I’m going to tighten the belt,” said Heisdorffer, who is also the president of the American Soybean Association. “Probably, if things don’t get straightened around somehow by next year, we may not use the highest-dollar seed we can find. We may not put as much fertilizer on. We have no plans to buy any new equipment, or even used equipment, unless absolutely necessary.”
Tariffs Put Maine’s Lobster Industry in Hot Water
July 6, 2018: CNBC published an article highlighting how tariffs are negatively impacting Maine’s lobster industry.
Peak lobster season in Maine occurs in July and August. Last year, America exported what was worth hundreds of millions of dollars of lobster to China. But now, the industry is unsure how to handle China’s recent 25 percent tariff on many agricultural products.
“A distributor told NBC that he made a $1.5 million investment this spring with expectation that the lobster market in China would continue to grow,” the article stated, “but he is unsure if that was a good plan since 20 percent of the market is now closed.”
Tariffs a Nail in the Coffin for Missouri Manufacturer
July 6, 2018: The Associated Press published an article featuring Missouri-based nail company Mid Continent Nail Corp., and how it’s dealing with steel tariffs.
The raw material used to make the nails is steel imported from Mexico. Because of tariffs on steel, the company is paying 25 percent more than it did before June 1. Nails now cost more, which has turned away costumers. Lower revenue has resulted in 60 layoffs, with the potential for hundreds more.
“We’re making decisions one day at a time,” said Chris Pratt, operations general manager for the plant. “We just need relief as quick as possible. Every day it’s a financial burden. … We’re paying workers that are not able to produce because we’ve shut 50 percent of our production down because of lack of orders.”
Washington Betting Tennesseans’ Farms on Tariffs
July 6, 2018: News Channel 5 Network published an article featuring one Tennessee soybean farmer for whom China’s retaliatory tariffs on soybeans came at an inopportune time.
Will Hutchinson, a farmer in Rutherford County, had already planted 70 acres of soybeans when China imposed tariffs on American agricultural imports in retaliation for tariffs imposed by Washington, D.C. He estimates that tariffs will cost him more than $20,000 this season.
“I’m not sure the people in Washington have a full understanding of what their decisions are doing to us. We need them to come to terms and think about how this is affecting people in the homeland,” Hutchinson said. “We will lose more farmers because of this.”
‘We Live and Die by Trade’
July 2, 2018: The Wall Street Journal published an article highlighting how America’s threats to withdraw from the North American Free Trade Agreement and foreign retaliatory tariffs are giving farmers anxiety about their futures.
Many farmers depend on exporting 20 percent of their products. But Chinese threats of retaliatory tariffs on agricultural products have slashed prices. The total value of America’s corn, soybean and wheat crops this year has dropped some $13 billion (10 percent) since the beginning of June.
“We live and die by trade,” said Arkansas farmer Rusty Smith.
Tariffs on Foreign Cars Would Leave Industry Running on Empty
June 29, 2018: POLITICO published an article featuring General Motors, warning that tariffs on foreign cars would harm workers and customers.
The United States has launched an investigation under a little-used provision in the Trade Expansion Act. If the investigation finds foreign cars present a threat to national security, the United States plans to impose a 25 percent tariff.
“The correlation between a decline in vehicle sales in the United States and the negative impact on our workforce here, which, in turn threatens jobs in the supply base and surrounding communities, cannot be ignored,” GM said. “Alternatively, if prices are not increased and we opt to bear the burden of tariffs or plant moves, this could still lead to less investment, fewer jobs, and lower wages for our employees.”
Gas, Electricity Hikes a Possible Consequence of Steel Tariffs
June 20, 2018: The Hill published an opinion piece highlighting how tariffs on steel could hike gas and electricity prices for consumers.
Pipelines are the best way to transport oil and gas to the refinery or storage hub. But building pipelines takes time and resources. In the interim, railcars are often used while pipes are being laid. Global consulting firm ICF estimates that tariffs could raise the market value of imported line pipe between $4.25 billion and $7.27 billion.
“That additional cost will be passed along,” the article states, “eventually reaching consumers in the form of higher gasoline and electricity prices.”
Companies Reliant on Steel Hurt by Steel Tariffs
June 20, 2018: The Lincoln Journal Star published an article by the Associated Press highlighting how steel tariffs are threatening to put one nail company out of business.
The largest steel nail manufacturer resides in Missouri. Sen. Claire McCaskill said that company has lost nearly half its business. It will sell fewer than 4,000 tons of steel nails in July, when it previously sold 9,000 tons. The company, she continued, is worried about being out of business by Labor Day.
“The customers can easily source nails manufactured in other countries,” McCaskill said.
Industries and Entire Cities Harmed by Steel Tariff
June 19, 2018: WFMJ published a news package highlighting how steel tariffs concern not only one steel fabricator, but its entire city.
Russian steel fabricator Novolipetsk Steel has a subsidiary in Farrel, Pennsylvania, called NLMK. The 25 percent tariff on foreign steel could keep the company from being profitable. That would not be good for Farrel, as the company generates 22 percent of its general fund.
“If [NLMK] were to somehow succumb to the tariffs in place,” said Farrell City Manager Michael Ceci, “that would mean a big loss in revenue to the city and really hurt our ability to provide the basic services to the residents.”
Protectionism Crushes Corn
June 19, 2018: Lincoln Journal Star published an article describing how tariffs are threatening Nebraska’s corn farmers.
The industry now fears retaliatory tariffs from China, after new tariffs on $200 billion of Chinese imports were announced. Retaliatory tariffs are likely to target agriculture.
“Nebraska corn farmers are already struggling to break even due to low corn prices, but these tariffs aren’t hurting just farmers,” said David Merrell, chairman of the Nebraska Corn Board.
“More than one million American jobs are supported by U.S. ag exports alone,” Merrell said.
Steel Purchasing Firms Brace for Tariff’s Impact
June 18, 2018: AgWeek published an article highlighting how a company that manufactures steel grain storage bins and grain-drying equipment in North Dakota is being impacted by steel tariffs.
“As soon as the word ‘tariff’ was muttered, basically steel mills took full advantage of that and created a fairly false sense of demand. At least the prices showed that,” said Josh Rauser, operations manager at Superior Grain Equipment Inc. “It’s come to a head more and more as the months are progressing. As of right now, the steel prices are the highest they’ve ever been, with no return in sight.”
Rauser expects the price of steel to increase by up to 27 percent.
Trade Restrictions Severely Stifle Soy
June 18, 2018: Successful Farming published an article explaining how retaliatory tariffs on American soybean imports could spell disaster for the agriculture industry.
Ohio State researchers found that farmers in Ohio could face a 50 percent drop in farm income. Iowa State found that producers in its state could lose up to $624 million this year, depending on tariff duration and other variables.
“As a soy grower, I depend on trade with China,” said Kentucky farmer Davie Stephens, vice president of the American Soybean Association. “China imports roughly 60 percent of U.S. soybean exports, representing nearly one in three rows of harvested soybeans. This is a vital and robust market that soy growers have spent over 40 years building and, frankly, it’s not a market U.S. soybean farmers can afford to lose.”
Protectionism Benefits Foreign Competition, Hurts US Firms
June 17, 2018: The Wall Street Journal published an editorial featuring one locker-maker who said tariffs could force him to switch from buying American to buying Chinese.
John Altstadt is the president of Lyon Group Holding, which makes lockers for workplaces, gyms and schools. Tariffs on steel have given Chinese competitors an unfair advantage, since there’s no tariff on their lockers or locker components.
Altstadt can’t raise prices on his customers, since they already pay a premium for his fully American-made product. If the tariffs remain, he’ll be forced to buy foreign-made locker components. In turn, that would force him to lay off at least 25 percent of his American workforce, and perhaps sell one of his factories.
Steel and Aluminum Tariffs Raise Prices, Threaten Jobs
June 15, 2018: The New York Times editorial board published an article explaining how retaliatory tariffs on American imports harm businesses in the Midwest.
Less competition from foreign suppliers has allowed domestic steel makers to hike prices. The cost of steel has increased 40 percent since January, according to the U.S. Chamber of Commerce. That extra cost comes out of profits or gets passed on to customers. The new aluminum tariff is having the same effect.
“Threatening an all-out trade war, insulting our next-door neighbor and ally, will not change the nature of our economy, only damage it.” said the editorial.
Tariffs Prompting Higher Prices, Market Uncertainty
June 13,2018: WFAA TV published a news package highlighting how one Dallas company is struggling to deal with steel and aluminum tariffs.
David Yoes is the owner of a family-owned metal fabricator called Cardinal Metals. He has seen some prices increase between 30 percent and 50 percent.
“Moving over from last year, prices have gone up every couple of weeks,” Yoes said. “It’s really thrown a quagmire into the industry.”
According to the article, “A new report from the U.S. Labor Department on Wednesday said that prices climbed 4.3 percent alone in May, the highest surge since 2011.”
Trade Protectionism Leaves a Dent in Duffy’s Business
June 13, 2018: NPR published a segment highlighting how steel and aluminum tariffs are harming one Massachusetts company.
Paul Duffy is chief executive officer of Engineered Materials Solutions based in Attleboro. The company specializes in clad metal products, producing a variety of goods — from pots and pans to electrical switch breakers. For now, everything is good, as the company is expanding. But since the business relies on steel, Duffy is expecting tariffs to cost millions of dollars.
“[The situation] is very significant for us,” Duffy said, “because we wouldn’t want this to turn into a situation where it impacts our staffing or our ability to retain our labor force and grow in the future.”
Trade Protectionism Comes With a Bite
June 7, 2018: The Patriot-News published an article that said despite gains for some steelworkers, tariffs do more harm than good.
The possibility of retaliatory trade restrictions have many concerned. If the United States makes it more expensive to do business within its borders, other countries will do the same.
“There has to be a better way than getting into these battles,” said Mark O’Neill of the Pennsylvania Farm Bureau. “We need opportunities to sell more of our products…not policies or actions that are going to make it more difficult to sell our products.”
American Pork Takes a Hit From Mexico
June 7, 2018: The Star Tribune published an article highlighting how pork farmers are hurt by double-whammy tariffs on pork.
As retaliation for trade restrictions imposed by the Trump administration, Mexico has followed in China’s footsteps and is imposing tariffs on American pork products. For farmers in Minnesota, this could do significant damage.
“The tariff basically raises our price by 20 percent to Mexico…NAFTA and free trade with Mexico is just critical for the U.S.,” said Greg Boerboom, a hog grower near Marshall, Minnesota.
“The longer that U.S. exporters are hobbled by trade restrictions, the greater the potential economic damage, Buhr said. That’s because there are plenty of competitors in global agricultural markets, and for them, ‘this is an opportunity.'”
Tariffs Reveal Their Hidden Costs
June 6, 2018: The Washington Post published an article reporting how one man’s business is being affected by the hidden costs of tariffs.
Bill Adler is the owner of metal-parts maker Stripmatic Products in Cleveland. Last year, the company placed a bid to replace a Chinese company on a contract to make commercial sausage stuffers. But once the White House implemented tariffs on steel and aluminum, prices jumped nearly 50 percent. Stripmatic lost the bid because he could not beat the Chinese company’s price.
“Our customers source on a global market,” Adler said. “I’m going to be at least 30 to 40 percent disadvantaged on steel…I’ve lost my competitive advantage.”
Risking 97 Percent of Industry Jobs
June 4, 2018: An editorial from the Omaha World-Herald highlights how recent tariffs on Canadian imports will harm Nebraska’s economy.
Steel makes up about half the costs of many products made by Behlen Manufacturing, based in Columbus, Nebraska. Its products include grain bins, water tanks for cattle, and farm fences and gates. The price of American-made steel has risen 40 percent since the beginning of the year, meaning costs are rising quickly on the manufacturing and construction industries.
“Without these imports, the U.S. cannot meet growing demand for aluminum,” said the Aluminum Association, which represents American manufacturers. Trade restrictions “put at risk the 97 percent of U.S. aluminum industry jobs in mid- and downstream processing,” the association continued.
Americans Pricing Out Americans
June 2, 2018: The Wall Street Journal published an article showing how, even though tariffs may initially benefit American steel and aluminum industries, their customers are taking a hit.
When manufacturers and fabricators take a hit, end-users bear the burden.
“A few of our customers have moved some of their production back to Europe and Canada because of the increases in prices for raw materials,” said Jerry Pines, chairman of Millenia Products Group, a fabricator based in Itasca, Illinois. He said the effect of tariffs on pricing and availability “has made the marketplace the most difficult place to operate in the 50 years I have been in the steel business.”
Tariffs Sour the Milk Industry
June 1, 2018: The Associated Press issued an article highlighting how tariffs hurt Americans in a variety of different ways.
Nebraska farmer Ben Steffen is a dairy farmer who also grows corn, soybeans and wheat. Several of his products are vulnerable to trade restrictions because he exports a significant amount.
“This is the worst possible thing to have for our milk market, and it’s the same for every other commodity,” he said. Mexico is the largest customer for American exported milk. “These are important relationships.”
Harm Trickles Down the Production Line
May 31, 2018: Duluth News Tribune published an article explaining how the unpredictability of tariffs create turmoil in the agriculture industry — as well as related industries.
“Mexico is a huge concern to us ag exporters because that has become a major market for us, as well,” said Burce Abbe, executive director of the Midwest Shippers Association.
“We’ve sought to really convince the rest of the world that the U.S. is the most reliable supplier they can find. So, it’s very worrisome when we get into these unpredictable kinds of actions that almost invite or guarantee retaliation by the other sides,” said Abbe.
From Montana Farm to World Market
May 31, 2018: Montana Public Radio published a news package featuring Michelle Erickson-Jones, a farmer from Broadview, Montana, speaking about the importance of trade.
“We depend on free trade policies to maintain our export markets,” she said. Erickson-Jones is also the president of the Montana Grain Growers Association.
“Crops that we grow here on this farm are exported across the globe,” she said. “Policies that restrict trade would be devastating for farms like ours. Someday, I’d like to pass the farm down to my boys.”
3 Jobs Lost for Every 1 Gained
May 29, 2018: Trade Partnership Worldwide LLC and The Trade Partnership released a report describing the negative effects tariffs on motor vehicles and parts could have on other industries.
The report estimates that a 25 percent tariff “on U.S. imports from all countries of automobiles, SUVs, light trucks, other vehicles and parts” would create 92,400 jobs in the automotive industry, with the possibility to create more than 40,000 additional jobs in related industries. However, 292,411 would be lost as the effect of tariffs take their toll on the rest of the economy.
“About three jobs would be lost elsewhere in the economy for every U.S. motor vehicle job gained,” the report states, and “GDP would decline by 0.1 percent as higher costs, net job losses, and declines in producer and consumer spending power work their ways through the economy.”
Not Just Money — Tariffs Cost Jobs, Too
May 16, 2018: The Omaha World-Herald published an article in which the chairman of Behlen Manufacturing Co., a global leader in steel fabrication, says steel tariffs could cost the company between 50 and 60 jobs.
As plans were announced to impose tariffs on steel imports, foreign producers were discouraged to sell in America and the price of domestic steel increased as much as 40 percent.
Tony “T.R.” Raimondo, chairman of the Columbus, Nebraska-based company, mentioned that it was likely to lose a large customer if U.S. steel prices remained elevated.
Tariffs Causing “Cease-Hire”
May 9, 2018: A Reuters article highlighted how tariffs negatively affect small manufacturers, including:
- Mike Haberman was seeing a “booming demand” for his construction equipment and he was planning to hire at least 30 more workers for his Ohio manufacturing facility, Grandall Industries. But because of a steel tariff, the cost of steel used in Grandall’s telescopic excavators and vacuum trucks rose by one-third. Haberman had to postpone additional hiring.
- Mike Schmitt, president of The Metalworking Group in Ohio, said his company lost about 1,000 hours repricing and renegotiating contracts because it could no longer honor old prices. The company also had to delay plans to spend some $500,000 on equipment and hire more employees because prices were so uncertain.
- Vollrath Company in Wisconsin makes cookware and bakeware. Local mills couldn’t meet its demand, so it continued buying from China. The company’s chief financial officer said the tariffs would make its aluminum products at least 20 percent more expensive than the foreign competition’s prices. Input costs were estimated to increase by as much as $6 million. The company also had to suspend hiring.
April 22, 2018: The Kansas City Star editorial board published an editorial highlighting how a retaliatory step by China drove down grain prices in Kansas, even before tariffs are imposed.
In February, China announced its intent to investigate alleged grain-dumping into its markets. It was seen as a retaliatory action in response to the threat of steel and aluminum tariffs.
Dan Atkisson, a sorghum grower in Stockton, Kansas, recalled that prices “fell over 90 cents.” Sorghum is “the backbone” of Kansas’ farm production. Then China announced a 178 percent tariff, which induced another round of worry into the sorghum market.
Farmers Need NAFTA
April 18, 2018: Fortune published an op-ed written by a seventh-generation farmer and chairman of the Agri-Business Committee, highlighting the unintended consequences of tariffs.
Cattle farming is a way of life for Casey Guernsey’s family. Guernsey Farm, in Harrison County, Missouri, is one of many farms across the Midwest that needs to avoid a trade war at all costs.
“Now, as tensions between the U.S. and China continue to escalate, the future of critical trade deals like the NAFTA are more important than ever,” Guernsey writes. “Without NAFTA, our ability to sell homegrown goods to key markets around the world hangs in the balance.”
Extra, Extra: Can’t Read About It
April 18, 2018: Tampa Bay Business Journal published an article announcing the Tampa Bay Times was planning to cut about 50 jobs because of increased newsprint prices resulting from tariffs.
Tampa Bay Times Chairman and Chief Executive Paul Tash wrote an article soon after the tariffs on the imports of newsprint from Canada were announced. He warned that the price would jump from $600 to $800 per ton. The publication uses some 17,000 tons every year, meaning more than $3 million would be added to the newsprint bill.
April 18, 2018: Bloomberg published an article featuring a California company whose 2018 profit was wiped out due to tariffs on steel and aluminum.
Pacific Coast Producers is a cooperative that cans produce from 168 family farms. Trade restrictions caused the price of cans to increase by some 9 percent, which the cooperative now must pass on to consumers.
“We’re going to have to try to get these increases in the markets,” he said. “As with all tariffs, ultimately the consumer pays the bill.”
Can a Kid’s Ride Get an Exemption?
April 16, 2018: The Washington Post published an article about how American companies are seeking exemptions from steel tariffs.
Scott Way, a Texas resident, looked all over the country for steel rail for the small steam train, but ended up ordering from China when he couldn’t find anything. He signed the order days before tariffs were announced. He’s hoping he’ll be granted an exemption.
“This is the first time I have ever imported anything, let alone steel,” said Way, owner of a family 19th-centruty-pioneer-town-style resort. He was looking to build a train kids’ ride.
No Barns for Young Pigs
April 16, 2018: The Tennessean published an article highlighting how tariffs affect the Tennessee farming industry.
Plans to build 30 new barns for pigs became tentative for Jimmy Tosh after trade restrictions were imposed on steel and China levied tariffs on pork. Rebar pricing increased 17 percent, making barn construction more expensive. Tosh expects to lose revenue in pork sales, as well.
“It’s becoming much more difficult to be a Republican in this type of an environment,” he said. “The Republican Party has always stood for free trade. They seemed to have moved away from it.”
The End Game for Pork and Beans
April 13, 2018: NPR published a news report in which Nebraska farmer Joe Fryman says he wonders if he’s being used as a pawn in a chess game.
China is America’s No. 2 market for agricultural exports, and Nebraska is at the heart of that. Many farmers were immediately alarmed and fearful of the consequences of China’s tariffs on American pork and soybean exports.
“I just wish we knew what the end game was in this whole tariff thing,” Fryman said. “And maybe there is no end game. Maybe we’re playing this from the hip as we go along here.”
April 13, 2018: The BBC asked, “Who is losing out from Trump’s tariffs?” The answer: Many different people. One of them is Randy Goodman.
Goodman is an executive at Georgia-based Greenland America, which buys and sells scrap metal around the world.
“The issue is that these other countries or even the domestic consumers … can’t pick up all the slack, so there will be excess material,” he said. “There will be an overhang in the market that will eventually affect the pricing.”
What About the Greater Goods?
April 4, 2018: The Nebraska Farm Bureau releases a statement on China’s retaliatory tariffs — after the U.S. imposed tariffs on Chinese-made steel and aluminum, and the Chinese imposed tariffs on American exports of pork and soybeans.
“These actions have cost farmers hundreds of millions of dollars in lost value in agriculture markets at a time when they can least afford it,” the statement said. “Nebraska farmers and ranchers and the markets they rely on should not be sacrificed as a negotiation tactic. It’s critical the United States and China stop the ‘eye for an eye’ tactics and return to negotiations that serve the greater good for both interests.”
Triple-Whammy in North Dakota
April 4, 2018: West Fargo Pioneer published an article in which a grain merchandiser, an executive from a steel fabrication company and director from a beer company — all based in North Dakota — say mere price uncertainty is causing upheaval.
Even though nothing was in effect, the fact that China had expressed its intent to impose a 25 percent tariff on American imports caused a price panic.
“Weekly, we’re getting changes in prices going up, up, up,” said Lee Holschuh, president and chief executive officer of Mid America Steel Inc. “For us, it’s one of the raw material costs. It’s the eventual consumer of our product — a school, a shopping mall, whatever — that is going to have to pay more or cancel the project if the cost goes up too much.”
Fear of the Unknown
April 3, 2018: A report from KSN featured a Kansas farmer who says he is “as concerned about prices now as he has ever been” because of China-imposed tariffs on pork and other products.
“The talk about NAFTA, and the talk about trade with China, TPP, those were all good things for agriculture,” said Doug Claassen, who runs a family hog, cattle and farming operation outside Whitewater. “And it worries me that the future is unknown.”
Tariffs Have Bad Timing
March 23, 2018: KVRR published an article in which a soybean farmer based outside of Valley City, North Dakota explained that timing could not be worse for tariffs.
Monte Peterson is a soybean farmer and vice president of the U.S. Soybean Export Council. He explained that of the 7 million acres of soybeans grown in North Dakota, 71 percent is exported to China.
“The timing is not great,” he said. The farm economy was, at that point, down 50 percent and crop prices were down 40 percent. “We depend on those exports to support our business.”
Argentina Looks Better than America
March 6, 2018: Bloomberg published an article announcing that DowDuPont Inc., the world’s largest chemical company, is considering Canada or Argentina — instead of the United States — for its next major investment due to steel tariffs.
“You eventually get yourself to the point where you are saying, ‘Should I really be building that here or somewhere else?’” said Chief Operating Officer Jim Fitterling. “We’ve got opportunities in other places like Canada, like Argentina. All of them right now are on the radar screen.”
Tennessee Will Have to Wait
March 2, 2018: The Tennessean published an article in which a foreign company halted plans to expand and open shop in the United States because of trade restrictions on aluminum and steel.
Sweden’s Electrolux is Europe’s largest home appliance manufacture. It was planning a $250 million plant expansion in Springfield, Tennessee. But those plans are now on hold, due to the tariffs.