Three tire-cord manufacturers got a push-back in their effort to win trade exclusions from Trump. They threaten closure.

Arkansas Online reports Tire-cord makers with operations in Arkansas threaten closures after bid for tariff exclusion contested.

Bekaert Corp., Kiswire America and Tokusen USA jointly requested blanket exclusion from what they described as "grade 1078 and above wire rod for tire cord" that they import, arguing that the quality of wire rod they require is unavailable from U.S.-based steel producers.

If they can't get access to the imported steel they need, the companies say they will close their operations. Together, they employ 1,500 people at four plants in Arkansas.

"Stated simply, U.S. wire rod producers are incapable of producing grade 1078 and above wire rod to produce tire cord because that grade of wire rod must be produced in basic oxygen furnaces to achieve the strength, cleanliness and other properties to draw the wire rod to tire cord dimensions," according to the companies' legal representative, the Washington, D.C., law firm of Morris, Manning & Martin LLP.

But the Wire Rod Coalition, a trade organization of U.S. producers of carbon and alloy steel wire rod, disagrees and has filed an objection to the request for a blanket exclusion.

Coalition members say they can and do make the same quality steel tire cord without using the basic oxygen, or blast, furnaces that Bekaert, Kiswire and Tokusen say their steel requires. "Grade 1078 and above tire cord wire rod can be and is produced using electric arc furnace steel," the coalition's legal counsel, Kelley Drye & Warren, said in a formal objection.

Image from Rubber and Plastic News.

Trade Foolishness

Our Steel and Aluminum industries (and many others) have been decimated by decades of unfair trade and bad policy with countries from around the world. We must not let our country, companies and workers be taken advantage of any longer. We want free, fair and SMART TRADE!

— Donald J. Trump (@realDonaldTrump) March 1, 2018

People buy into that notion because it is repeated often enough.

But whether or not such steel is available in the US, those manufacturers will face much higher costs.

The same applies to every company in the US that uses steel or aluminum.

Job Reality

Employment is down 57.7% while production is up 7.7%. Those steel jobs are lost and gone forever. It's called productivity.

Jobs at Risk

There are about 6.5 million workers at manufacturers that use a lot of steel, but only 140,000 steelworkers, says Moody’s.

To protect 140,000 jobs Trump is willing to put 6.5 million workers at risk.

How stupid is that?

It's so stupid US Steelworkers do not even support Trump's latest play with Mexico and Canada.

The United Steelworkers don't support the Trump administration's latest steel-tariffs move, which extends the duties to Canada. "This decision is unacceptable and calls into serious question the design and direction of the administration's trade policy." @steelworkers

— William Mauldin (@willmauldin) May 31, 2018

Spotlight On Cars

Trade War Math

Trump Madness in Numbers

• 6.5 million US employees benefit from lower prices.
• Only 140,000 employees benefit from tariffs.
• 325 million US consumers benefit from lower prices.
• Cheap steel is to the benefit of US exporters if the EU applies tariffs and the US doesn't

If, as claimed, China is dumping steel, it is to our benefit at China's expense!

Only economic fools cheer Trump's trade madness.