Metal tariffs already hurting Heartland businesses
CAPE GIRARDEAU, MO (KFVS) - Tariffs on imports of steel and aluminum from the Europe, Canada and Mexico will likely start Friday, but Heartland businesses that sell metal products are already hurting because of it.
Sonny Underwood, the president of Mid-South Steel Products, only buys raw steel here in the U.S. but says prices quickly escalated after the tariffs we're announced in early March.
"I've been through lots of price changes both up and down," Underwood said. "This time in two or three weeks you know we are seeing anywhere from 35 to over 50 percent increase in my raw materials. To me it doesn't make a lot of sense."
Before talk of tariffs started, Underwood says he got a 30-day price guarantee on raw steel, but now prices can change in just 24 hours.
In his conversation with other steel manufacturers, Underwood says they only have guesses to how long the effects of the metal tariffs could last.
"I think we'll see some settling down near the fourth quarter this year. We may even see some reduction," he said. "For our company, it won't cost anybody their job. We will probably not need to hire any new people for manufacturing because we have to pass the prices along so it's ultimately our customers that have to pay the higher price for our product."
Matt Wormington with Bootheel Fence Company says his customers are also noticing higher prices for their metal products and thinks the aluminum market has had some irregular spikes.
"We've had the first set of increases now that we've seen in three years. We've already had two increases this year, and we are expecting probably another one again," Wormington said. "Hopefully it will settle out quickly and then we get it back to level so maybe it's not a yearly or every couple year increase on our products that would be ideal."
Wormington and hope the tariffs will eventually help the U.S. economy by leveling the marketplace.
"It's looking like it'll bring some jobs back into the US for us to be able to produce our own raw material, do our own mining and stuff for those aluminum and steel products which I think is a good thing."
Underwood understands the president's goal behind the tariffs but has his reservations.
"I don't have a negative view on president Trump over this but I'm not sure it was the smartest direction for him to take. Time will only tell," Underwood said.
Commerce Secretary Wilbur Ross says talks with Canada and Mexico over the North American Free Trade Agreement are "taking longer than we had hoped." He says negotiations with Europe have "made some progress" but not enough to merit an exemption to the 25 percent tariff on imported steel and a 10 percent tariff on imported aluminum.
Copyright 2018 KFVS. All rights reserved.