Tariffs Up To 300% On Steel For Tin Cans?

You will be got down paying more for your canned food goods. Yes this is One of several inevitable negative effects of the coming tariffs on tinplate steel.

Ohio-based steelmaker Cleveland-Cliffs Inc. and the United Steelworkers union joined forces in January to file petitions for anti-dumping duties against eight countries, for allegedly selling tinplate steel (also called tin mill steel, a thin steel sheet coated in tin used primarily in cans for food packaging) in the U.S. at below-market prices, The potential tariffs could be as high as 300%.

A domestic can manufacturer, Rick Huether, President and CEO of Belcamp, Maryland based Independent Can Company. Independent has two factories in Maryland, two in Ohio, and one in Iowa. The company makes a wide variety of tin cans, for things like popcorn, infant formula, lip balms, pet products, games, and toys. Most of these have high-quality color graphics printed on them, although other cans without graphics such as those for military purposes, are in demand.

At the time, the grade of steel they were using was $600 a ton in China and $1,100 a ton in the U.S., meaning even before labor and other costs their Chinese product was much cheaper on the world market. This is something I struggled to understand, since Chinese steelmakers buy iron ore at global market prices, they buy coking coal and presumably energy at something close to global market prices as well. Nonetheless, this explains why U.S. construction equipment makers must produce offshore to serve foreign markets; exporting from the U.S. would be challenging unless it was a unique piece of equipment that no one else made.

“The tariffs will hurt can makers and end users,” said Thomas Madrecki, vice president of supply chain at Consumer Brands Association, an industry advocacy for U.S. CPG businesses. “They’ll make can making and food manufacturing less competitive in the U.S., and significantly reduce consumer buying power. This is not the time to be considering such petitions.”

That means cost increases will soon hit supply chains and U.S. manufacturers–not to mention consumers.” With domestic producers not even making some of the types of tinplate required by can manufacturers, and with the generally thin margins across the canned food industry, the tariffs likely to be imposed by today’s decision will inevitably be passed on to consumers.

Let’s start off with the stuff destined to be made into tin cans. Tinplate is steel coated with a thin layer of tin to prevent corrosion. Tin cans are widely used to package food, but they are also used for many other products. While most beverage cans have transitioned to aluminum, tinplate is still very popular where you need packaging with sufficient mechanical strength.

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