EXCLUSIVE: JFE Products Included in U.S. Steel Tariff Exemption List

June 21, 2018

Tokyo- Products made by at least two Japanese companies, including JFE Steel Corp., were among the first set of product exclusions from additional U.S. steel tariffs, officials at Japan's trade ministry told Jiji Press on Thursday.

The exclusion list was announced by the U.S. Commerce Department on Wednesday. The products on the list are expected to be exempted from the controversial extra tariffs of 25 pct, introduced first in late March by the administration of U.S. President Donald Trump for steel imported from Japan, China and many other countries on national security grounds. At the same time, additional tariffs of 10 pct were levied on aluminum imports.

The Japanese steel products included in the exclusion list account for only a small portion of items exported from the country to the United States.

The Japanese government will thus continue urging the U.S. government to exempt all Japanese products from the additional tariffs, sources familiar with the situation said.

Japan's Chief Cabinet Secretary Yoshihide Suga said at a press conference on Thursday that Japanese steel and aluminum products do not affect U.S. national security and that they are contributing greatly to U.S. industry and employment.

The U.S. department approved a total of 42 requests from seven U.S. companies, including Nachi America Inc., a unit of Japanese cutting tool maker Nachi-Fujikoshi Corp. <6474>, for exclusions of steel they import from the additional tariffs. The products are from five countries--Japan, China, Germany, Sweden and Belgium.

The seven companies also include U.S. Leakless Inc., a unit of Nippon Leakless Corp., a Japanese maker of sealing materials for automobiles, and Atlanta-based steel-processing company PolyVision Corp.

In making the requests, they claimed that there are no alternative products.

The JFE Steel product in question is surface-treated steel plates, according to the Japanese trade ministry officials. PolyVision sought the exemption, the officials said.

The other Japanese product is rubber-coated steel made by a business partner of Nippon Leakless.

Special steel that Nachi-Fujikoshi exports to the United States for use by its U.S. unit may also have been exempted from the tariffs, informed sources said.

Meanwhile, the U.S. department rejected 56 requests from 11 companies for additional tariff exemptions.

The department did not disclose its screening standards or details of the exempted products.

On June 1, the United States added steel and aluminum from the European Union, Canada and Mexico to the list of products subject to the extra tariffs.

While the EU and some others are set to impose retaliatory tariffs on U.S. products, a Japanese government official said that tit-for-tat actions are not desirable.

The Japanese government is expected to closely monitor the situation, as the Trump administration may urge Japan to open its auto and agricultural markets further in return for abolishing the additional metal tariffs in the two countries' new bilateral trade talks, set to kick off in July. Jiji Press