US puts 522% tarrif on Chinese cold roll steel

[John_in_Longview]

The tariff was announced earlier in the year and US Steel's stock price just about tripled. After last week's announcement that China was going to raise production, the price of the stock fell about 7 bucks in a few days time. The tariff on China just causes them to sell to other countries, who in turn sell their flat roll in the United States b/c their country has a much lower tariff or none at all.

[Cobar]

So basically the Chinese still sell their junk steel, we still get it, but we pay more to a middle man.

[Aesop]

That depends on whether we're smart or stupid about it.
If we're smart, countries without tarrifs are selling use first-world steel that meets standards, and buying cheap China shit for themselves.
If we're dumbasses, then yes, we get boned with crap steel and pay for the privilege.
Letting middleman countries known that the tarrif will roll over on their goods if they try to transship Chinese junk steel would nip that in the bud, and in short order, "Made In China" will become the kiss of death.

So now we're only dependent on the common sense and intelligence of the U.S. government.

[Cobar]

So now we're only dependent on the common sense and intelligence of the U.S. government.

agreed on the

[John_in_Longview]

That depends on whether we're smart or stupid about it.
If we're smart, countries without tarrifs are selling use first-world steel that meets standards, and buying cheap China shit for themselves.
If we're dumbasses, then yes, we get boned with crap steel and pay for the privilege.
Letting middleman countries known that the tarrif will roll over on their goods if they try to transship Chinese junk steel would nip that in the bud, and in short order, "Made In China" will become the kiss of death.
So now we're only dependent on the common sense and intelligence of the U.S. government.

In addition to the government not paying close enough attention to dumping, there are domestic purchasers who only care about the cost, and not the quality, of the flat roll they purchase.

[Aesop]

In addition to the government not paying close enough attention to dumping, there are domestic purchasers who only care about the cost, and not the quality, of the flat roll they purchase.

Which exact problem, to the tune of a 522% mark-up, a tarrif was designed to solve.

[toad]

I worked with a QA inspector who had worked in Russia as an onsite quality assurance inspector for Hughes rotary drilling tool bits that the Communist Russians were making under license. Hughes had sent them a machine that sorted out the bearing pins by size and dropped all the rejects into a tray under the sorter. The communist managers could not get the idea of the value of quality, everything was quantity to them. Sure enough he found the commie sending the rejects down the line so they could meet or exceed production quotas and to hell with the poor guys that had to fish out the broken drill bit and
to heck with Hughes' reputation

[blackeagle603]

The industries here whose applications can handle low grade steel with inconsistent quality will be more inclined now to just offshore their production.

The network is self healing, it will route around the obstruction. The net loss will be to US workers, consumers and US tax revenue..

[evan price]

The saying is "You can sell anything to China, once."

The company I work for decided to shift manufacturing of a newly engineered but soon-to-be core piece of equipment to China. This equipment wound up being deployed worldwide. It departed from our normal engineering in that it used a lot of molded plastic instead of stamped & welded metal parts. Things like the polymer content, amount of glass reinforcement, and other such hard-to-identify details, got manipulated. We had parts failing in the testing labs that never failed in prototypes, were considered impossible to fail in the world. But the Chinese vendors were manipulating the polymers and mold processes. Leaving out metal core inserts. Using cheaper recycled polymers that were mixed material instead of virgin pure materials. Thinning out plastic content. Changing the molds to eliminate stiffeners and tabs that made a part harder to mold and more likely to be defective.

Then we started getting machines in to repair that had parts failing all over. Stuff that was basic and simple, consumables that would not load, little stupid details that had all been worked out long ago before production started. On top of that we found that replacements and consumables were just not selling when they needed to be sold to make up for volume of work.

It was determined that the Chinese vendors were selling failed production parts & pieces as well as their own in-house reverse engineered parts- with even more quality reduction, substitution of materials, etc- as genuine product in the replacement industry. So machines that had to our records never had problems, suddenly had to be returned to home base for major overhauls because of counterfeit secondary parts, and we were blamed because our machines were failing in service. The process to correct this stretched over several years and to my knowledge they were never able to fully correct the issue. As I recall they wound up calling end-of-life on this product earlier in the cycle than it normally would have been done, and rushing out the new product ahead of schedule with certain features that made it a lot more difficult to counterfeit and cheap out on.

But the geniuses decided Chinese manufacturers were going to make the parts for the new machine and it would be assembled in the US. So we have to QC all the new parts that come in and reject/destroy anything not to spec. And that cost got built into the new model... which cost more. So some customers kept their previous model machines and requested parts, which we told them was "End of life, I'm sorry we no longer provide support for that technology", so off to the Chinese aftermarket they go. And to this day on dedicated resources where people discuss these items, there are still people bad mouthing my company for that generation of machine ("But the new one is rock solid, they learned from their mistakes, hope they fired the engineers, etc etc") which was NOT the engineering but the Chinese vendors to blame.

[Vonz90]

The industries here whose applications can handle low grade steel with inconsistent quality will be more inclined now to just offshore their production.

The network is self healing, it will route around the obstruction. The net loss will be to US workers, consumers and US tax revenue..

+1 We need a like button.