This past Friday, the Department of Commerce made public its recommendation to the President on the Section 232 Investigation into steel pipe. The recommendation, as expected, contained a number of measures meant to encourage the use of domestic-USA made-steel pipe.
The major recommendations were:
- Tariffs of 24% on all steel pipe coming into the US
- Tariffs of 53% on steel pipe coming from specific named countries (Brazil, China, Costa Rica, Egypt, India, Malaysia, Republic of Korea, Russia, South Africa, Thailand, Turkey and Vietnam)
- Quotas that limit the amount of steel pipe countries are allowed to export to the USA
So, what does this mean for everyone?
- Expect price increases on import steel pipe (Update 2/26/18: click here to see the new Domestic Steel Pipe list price sheet)!
- Increase announcements have already been sent out.
- We plan on putting another increase into effect next Monday 2/26
- We expect this to be the first of several increases to be instituted on a regular basis over the next few months
- We fully encourage customers to switch to domestic steel pipe TODAY! It is our belief that more wholesalers will convert from import product to domestic product, which will bring jobs back into the USA, and spur more construction activity, which will be a boon to the entire country.
- Domestic prices will likely climb and lead times will get stretched
- As customers switch from import to domestic pipe, the domestic mills may raise prices (supply/demand driven)
- The increased demand on the domestic mills will likely happen more rapidly than the mills are able to ramp up production, which will result in extended lead times
- We will do our best to get out ahead of the curve, and have enough inventory to buffer our customers from the mill lead time issues, but inevitably they are going to impact our service levels
This is a fluid situation, and one we will continue to monitor and evaluate. Importantly, NONE of the recommendations are guaranteed – the President could follow them completely, or not at all. We will keep you informed as much as possible, but for specific questions, or to place your orders for Domestic and Import Steel, please call your Sales Representative: 1-800-777-7473
Click here to see all of our steel pipe products.