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News

USA: the domestic availability of tinplate at risks

29/09/2022 - François-Xavier Branthôme

CLFP lobbying efforts to lift 232 tariffs on tinplate steel

The California League of Food Producers (CLFP) along with a coalition of can manufacturers and food banks, has been engaging the California Department of Food and Agriculture, the Lt. Governor and the Governor’s Office of Business and Economic Development to ask for their assistance to both preserve the competitiveness of the agricultural producers and processors, and to ensure food security and availability. The Trump Administration’s Section 232 Tariffs and Quotas on tin plate and black plate steel (see also additional information below) is negatively affecting United States and California-grown canned agricultural products, and have the potential to significantly affect the food supply in the United States. U.S. canned foods are at cost disadvantage to imports due to President Trump’s tariffs from foreign canned food producers, including China, in U.S. schools, institutional settings, and grocery stores, costing U.S. consumers nearly USD 1Billion annually.

This undermines the U.S. farm economy and unfairly burdens the U.S. food security and distribution programs.

Of greater concern is the announced closure of U.S. Steel’s Pittsburg, California plant scheduled for the end of 2023. With the closure of that plant, U.S. tinplate production will drop to below 50% of U.S. market needs. No tin plate steel or black plate will be manufactured west of the Mississippi River. Domestic production of tinplate and black plate used to make cans for food have declined each year since the 232 tariffs were imposed even as consumer demand has grown from COVID related shutdowns and fear of supply chain failures. Furthermore, allocations of tinplate and black plate quotas by country will essentially force U.S. tinplate importers to purchase from China. CLFP believes those allocations should be adjusted to allow can manufacturers to obtain the most competitive pricing.

Worse yet for the U.S. food security, food producers may be confronted with shortages of cans due to quotas. Agricultural products will remain unharvested, and grocery stores will suffer a lack of available inventory, resulting in cascading economic impacts in California’s agricultural regions. Decreased availability of canned goods will also have a direct impact on consumers who are already feeling the squeeze of a pandemic, rising inflation, and increased energy costs.

The impact to California is particularly significant given the large contribution of the agricultural producers to the nation’s food supply. Yet some local schools and institutions in California are using imported foods over food produced just miles from that location. This is occurring even with the strong efforts in Congress and in the California Legislature to encourage Buy American* and California Grown, respectively.

Canned goods form an essential part of many American household’s dinner tables and are crucial to the American food supply, especially for consumers at lower income levels. Pre-pandemic surveys show that 83% of homes have canned foods in their pantries. WIC and SNAP** recipients consistently report relying on canned foods to a greater degree, consuming 7.1 cans of fruits and vegetables per week. Also, 67% of SNAP and WIC recipients report that canned fruits and vegetables are extremely or very important in helping them prepare convenient, nutritious, and affordable meals. Food Banks also rely on canned goods to ensure year-round availability of products for those that they serve.

CLFP is arguing that it is therefore critical to the nation’s food security and the California economy that relief be granted to ensure an affordable and adequate supply of cans to convert U.S. agricultural products into shelf stable food for U.S. communities. CLFP is requesting that the California Department of Food and Agriculture, the Lt. Governor, and the Governor’s Office of Business and Economic Development assist in its efforts to communicate the importance of granting tariff and quota relief as requested under Docket No. 220202-0041 to President Biden and Secretary of the United States Department of Commerce Gina M. Raimondo. The granting of relief will allow U.S. food producers to obtain critical supplies from allies in Europe, Japan and South Korea and reduce the cost of domestically produced canned goods to be able to compete with imports from China.

Some complementary data
On March 8, 2018, President Trump exercised his authority under Section 232 of the Trade Expansion Act of 1962 to impose a 25 percent tariff on steel imports, with exemptions for Canada and Mexico, to protect our national security. The President’s Section 232 decision is the result of an investigation led by the U.S. Department of Commerce (DOC). U.S. Customs and Border Protection began collecting the tariffs on March 23, 2018.

*: The Buy American Act ("BAA) passed in 1933 by Congress and signed by President Hoover on his last full day in office (March 3, 1933), requires the United States government to prefer U.S.-made products in its purchases.

**: SNAP and WIC are two different public health and nutrition programs funded by the federal government. Supplemental Nutrition Assistance Program (SNAP, also commonly known as food stamps) and Women, Infants, and Children (WIC) assist low-income families and their children in purchasing healthy foods through an Electronic Benefit Transfer (EBT) card or a WIC check.

Proclamation 10328 of December 27, 2021, by the President of the United States of America, adjusting Imports of Steel Into the United States

Sources: naylornetwork.com, bis.doc.gov, govinfo.gov

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