Experts of the Gaidar Institute listed countries that will be most affected by US duties on steel and aluminum

Gasan Ramazanov, expert of the Gaidar Institute noted that the largest exporters of aluminum to the US are Canada ($11 bn), China ($2.8 bn), Mexico ($1.8 bn), UAE ($1.2 bn), South Korea ($930 mn). These countries will most acutely feel the impact of duties on US aluminum supplies. Suppliers will have to raise prices for shipments, causing the loss of some of the US buyers. The expert believes that reduction of foreign aluminum supplies to the US market will cause a shortage of this metal and result in higher aluminum prices in the US.

«As for the introduction of duties on steel supplies to the US, suppliers from Canada, Mexico, South Korea, Brazil and Vietnam will be affected, as they are the main exporters of this metal to the US," believes Gasan Ramazanov.

Alexander Firanchuk, Senior Researcher, International Trade Department at the Gaidar Institute, noted that benefits from the above tariffs on steel and aluminum will be concentrated among a few large US steel companies having significant influence in their states. Thus, the costs caused by rising metal prices in the US will be distributed throughout the economy and charged to end consumers. As a result, this will cause a reduction in the competitiveness of metal-intensive products of American companies, primarily in foreign markets.

According to the expert, such a situation is common for the introduction of tariffs or other restrictions on imports. A limited number of domestic producers benefit, while the costs are borne by all consumers and, with regard to tariffs on intermediate goods, also by companies that use them in production.

«Given the scale of US imports of these metals, such tariffs could trigger some reduction in world prices, but it would be much smaller than the size of the tariff. In the short term, it is likely that Canadian producers and other suppliers focused on the US market will have to offer discounts to partially offset tariff costs. However, metals are relatively easy to divert to alternative markets, therefore such discounts, if they do appear, will not last long," concluded Alexander Firanchuk.

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