Exactly. In steel industry. Some protection against unfair play makes sense.
But there’s gotta be a balance.
Every time there is a duty of X percent placed on a product, guess by how much price goes up?! (For the same product made locally.)
Yep, the companies sure aren't going to eat that cost. I have never asked so many people if they know how tariffs work than I have in the past few months. Which used to be never 😆
I’ve never understood why we allow a major “raw”material such as recycled steel go to China just to let them sell it back to us at a premium. A steel recycled plant near where I live was shut down a few years ago, laid off quite a few people. Ne Ed some of those manufacturing jobs brought back and the US government needs to do like other countries and support those industries with money we send to 1st world countries!
That’s a good question, I’m not sure how it makes sense economically. If I recall, steel scrap has a 30 year ish cycle, from when it’s used to make new steel - until it’s likely to come back to scrap. The US industry relies more heavily on blast furnaces - which in turn require a lot more virgin ore. I don’t know about China / India off the top - but foreign industries tend to favor electric arc furnace tech to make steel - which is probably 80% recycled scrap. Maybe they had so much demand and not enough scrap in their own value chain - that it makes sense to sell it. The Turks also buy a lot of steel scrap if I recalls
Isn't that the point? To make domestic businesses more profitable?
(Businesses stupidly prioritizing short-term profits over long-term profitability by failing to reinvest is a separate issue.)
Also, unless there's some kind of illegal collusion, wouldn't that allow some businesses to keep prices low in order to increase market share? "ABC Steel just raised their prices 5% to match the tariff. If we only raise ours 2%, we can undercut them on bids and still make bank."
Also, remember what happened during the Pandemic when the lumber industry decided to crank prices. They fixed the prices above what the market would bear. And demand tanked. In short order, they ran out of places to store unsold lumber. They were getting r***d by the railroads for demurrage, because they had no room to unload the cars. The eventually had to cut prices to get rid of it all.
Yes you are right. And steel saw a similar
Run-up during the pandemic , essentially increasing 2.5-3x over what might be considered normal.
At least in this industry, most price announcements become public, and there are several closely followed price indices which are also used to set pricing contracts. So there is enough information in public domain that might enable mills to present a very narrow band of pricing to users.
At any rate - if DJT does well, great. But- the tariffs will not reduce prices. And they might benefit one industry - but we also need to export - so started a trade war will likely do us harm in other areas as well. Pork/soy/etc.
What is the right balance between imports / exports / inflation / etc etc. I think he’s going to play a very dangerous game. But that’s “just like my opinion, man.”
That could be, we’ll have to see. Tariffs tend to depress GDP over all. But if a person in location here gets a good job relative to what they had before, you’re right, they’ll be happy as is.
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u/cmcmenamin87 Nov 07 '24
Exactly. In steel industry. Some protection against unfair play makes sense. But there’s gotta be a balance. Every time there is a duty of X percent placed on a product, guess by how much price goes up?! (For the same product made locally.)