If you’ve been reading or watching the news lately, you will have seen that there’s quite a lot of talk about President Trump’s introduction of tariffs on imported steel and aluminum. The scrap metal recyclers at Calgary’s Federal Metals Inc. have been keeping a close eye on the situation so that we can be in a position to, in turn, better inform others in the metal buying or selling sector.
Under Trump’s new tariffs, imported aluminum is taxed at a rate of 10% while imported steel is taxed at a rate of 25%. What impact this might have on the U.S., Canada, and scrap metal recycling facilities in Calgary isn’t yet too clear. However, many experts are cautioning that these tariffs, which were presented as a measure to help restore U.S. manufacturing, could actually hurt the U.S. economy.
Industry associations and stakeholders in the demolition and construction industries have noted that the tariffs may actually lead to an increase in material prices across the U.S., cutting profit margins. Additionally, though the industry is currently growing at a near-record pace, the tariffs could decrease the demand for the services of contractors and bring that expansion to a halt.
The prospect of a trade war between the U.S. and its trading partners is also a cause for concern in the agricultural sector. China, Mexico, and Canada are the three biggest markets for U.S. farm exports. The American Farm Bureau worries that retaliatory tariffs by other nations could severely impact their profit margins as well.
As with most major U.S. policy changes, Canada could also be greatly affected by the Trump tariffs. Not only is the U.S. our largest trading partner, but Canada supplied the U.S. with $4 billion of steel and $7 billion of aluminum in 2017. Even scrap metal facilities that don’t sell directly to the U.S. have customers that do supply the U.S. with metal products manufactured from Canadian steel and aluminum.
However, scrap metal recyclers in Calgary and throughout Canada are not limited to selling their products only to the U.S. market. Some are refocusing their efforts on selling domestically while others are investing in equipment to send scrap metal through the rail system and overseas to markets such as Europe.
Though the Trump tariffs will certainly have an impact on scrap metal recycling in Calgary, steel and aluminum both remain in global demand. There’s also no certainty that these tariffs will remain in place long-term, especially if they do end up having a negative impact on the U.S. economy. Federal Metals Inc. will continue to provide top-quality metal recycling services and top-quality metal products. We will also be providing scrap metal prices in Calgary for buyers and sellers on a day-to-day basis, helping to increase industry confidence.
A Canadian-family owned and operated business that has been recycling metal for almost 70 years, Federal Metals Inc. understands the industry and all of its ups and downs. If you have any questions or concerns, we welcome you to contact us and speak to our Calgary metal suppliers and recyclers today.