Tariff reactions mixed, but reshoring advocates see positive signs

Reactions to the Trump administration tariffs seem to show cautionary statements and warnings are outweighing outright endorsements of the policy measures.

Fact sheets and executive orders issued by the White House already have affected trade with Canada, China and Mexico across all goods and commodities as well as inbound steel and aluminum from around the world.

Additionally, the White House has announced it is examining copper imports into the United States, and President Donald Trump has identified the European Union as a potential target for tariffs.

In the U.S. commodities sector, the American Forest & Paper Association (AF&PA), The Aluminum Association and the Plastics Industry Association have issued separate statements suggesting one or more changes or exemptions to administration tariff policies.

In its early March statement, the Washington-based AF&PA has expressed concern that the tariffs on Canada and Mexico will disrupt the forest and paper industry’s “complex” cross-border supply chains.

Similarly, Washington-based Plastics Industry Association CEO Matt Seaholm stated in early March that his trade group “remains deeply concerned about the tariffs on Canada, Mexico and China and their impact on U.S. plastics manufacturing and jobs.”

Charles Johnson, president and CEO of The Aluminum Association, submitted an op-ed column to Recycling Today last month that reads in part, “There’s a lot to like and a lot we support in the president’s action. Though—and this is critical—for our industry’s growth, and for national security, we must maintain tariff-free access to aluminum from Canada.”

The executive is less sympathetic toward the Trump administration's trade actions against China, writing of the president, “He understands the genuine threat that nonmarket actors like China and their proxies pose to U.S. manufacturing and the defense industrial base, including critical materials like aluminum.”

On the investment front, the S&P 500 stock index closed at 5,778.15 Tuesday, March 4, just after the White announced it was moving ahead with across-the-board tariffs against Canada, China and Mexico. The next day, the White House indicated exemptions and reductions were likely, which was followed by another one-month delay on the Canada and Mexico tariffs.

That 5,778.15 S&P 500 figure is down 4.5 percent from the 6,049.24 index figure for Tuesday, Jan. 22, the first day the market opened after President Trump was inaugurated and before he started issuing tariff-related fact sheets and executive orders.

One trade group that has endorsed the Trump tariffs is the Washington-based Steel Manufacturers Association (SMA), with President Philip K. Bell saying last month, “The SMA applauds President Trump for putting the American steel industry and its workers first by imposing a 25 percent tariff on all steel imports.”

Company reactions are likewise varied on the tariff policies, though privately some business planners are most unhappy with the “on-again, off-again” nature of how tariffs have been enacted.

“It’s less about the tariffs and more the uncertainty that creates the concern,” one metal recycling executive told Recycling Today last month. “How do you plan for the unknown? Unfortunately, chaos is the agenda for the next four years.”

This month, a supplier to the metal recycling industry has made similar comments, telling Recycling Today, “Everyone I talk to is just frustrated with the back-and-forth statements and shifting deadline dates. How do you conduct transactions let alone make investments in that environment?”

Business planners seem to have expected a turbulent transition from the prior presidential administration to the current one, with several January economic indicator-related surveys and statistics pointing in the downward direction.

One recent announcement and another reported business decision, however, could have the Trump administration and fans of American reshoring smiling in early March.

Late last month, Apple Inc. announced it will invest more than $500 billion in the United States over the next four years, including a planned 250,000-square-foot computer server production facility in Houston.

Reuters has reported this week that Japan-based Honda Motor Co. Ltd. will assemble its next-generation Civic hybrid model in Indiana rather than Mexico. The news service says the move is being made “to avoid potential tariffs on one of its top-selling car models.”

The Florida-based Reshoring Initiative cites the Apple announcement as one of 10 corporate decisions signaling that “the mere threat of tariffs seems to be doing a sufficient job of defining the objective: the U.S. must boost domestic manufacturing to strengthen national security, reduce the trade deficit and support economic stability."

In addition to Apple, the organization lists 3M, Celltrion, Hyundai, LG Electronics, Lilly, Nissan, Polaris, Samsung and Volkswagen as companies making new announcements of big reshoring and nearshoring plans—some firm, some tentative.