August 12, 2018

DONALD'S GOVERNMENT REGULATION EXPLOSION:

Steel users are frustrated by process of seeking tariff exemptions (David Nicklaus, 8/12/18,  St. Louis Post-Dispatch)

RotoMetrics, a cutting-die manufacturer in Eureka, thought it had a strong case for being exempted from President Donald Trump's steel tariffs.

Nearly three months after it started asking for such an exclusion, the company is still waiting for an answer.

So is Deutsche Precision, a transmission parts manufacturer in Maryland Heights. The Commerce Department took weeks to even post its exemption requests.

Both companies import thousands of tons of steel a year, and they continue to price and sell their products despite not knowing how much that steel will cost -- the price suppliers were charging before Trump announced his trade action in March, or 25 percent more to cover the tariffs.

Commerce Secretary Wilbur Ross said up front that companies could apply for exemptions "through a fair and transparent process" with decisions based on "whether a product is produced in the United States of a satisfactory quality or in a sufficient and reasonably available amount."

RotoMetrics buys 71 percent of its steel domestically. It asked for tariff exclusions on types of tool steel that aren't available in the U.S.

Deutsche Precision imports all of its steel from Italy and Japan. Carlo Ilardi, the company's general manager, said domestic mills can't meet its customers' specifications for hardness and purity.

Each firm must file a separate request for each size, grade or chemical composition of a steel product it imports. So far, that adds up to 72 requests by RotoMetrics and 14 by Deutsche Precision.

Ken McInnis, RotoMetrics' director of supply chain-Americas and global purchasing, says dozens of his requests were kicked back for being incomplete.

Of the requests that went through the required 30-day comment period, several drew objections from steel suppliers in Ohio, Pennsylvania and Texas that say they can meet RotoMetrics' needs.

McInnis has checked; they can't. "They had huge lead times and were charging three times the price," he said. "Financially, we can't pay that and be viable."

The process, though, provides no way for him to answer the steel companies' claims. An objection seems to stop the request in its tracks.

"The process has just been a fiasco," McInnis said. "They kill it even though it (an objection) is not legitimate."

Ilardi, too, is frustrated by the exemption process. "There's nobody to call. You just email an address and hope they will respond," he said.

Posted by at August 12, 2018 12:24 PM

  

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