US increases pressure on Russia with 200% aluminum tariff

The US will apply a 200% ad valorem tariff on imports of aluminum and derivative aluminum articles from Russia beginning on March 10 as it continues to increase pressure on Russia's economy in response to its continued invasion of Ukraine, the White House said Feb. 24.

"The Russian aluminum industry is a key part of Russia's defense industrial base and has played a major role in supplying Russia with weapons and ammunition used in the war," the White House said in a statement. "In addition, Russia's war against Ukraine has caused global energy prices to rise, causing direct harm to the United States aluminum industry."

Furthermore, the US will also impose the 200% tariff on aluminum articles and derivative products from other countries "where any amount of primary aluminum used in the manufacture of the aluminum articles is smelted in Russia ... or the derivative aluminum articles are cast in Russia." This expanded form of the tariff will take effect on April 10.

The White House said the tariff will be enforced under Section 232 of the Trade Expansion Act of 1962, a mechanism that allows the government to apply trade action for national security and defense purposes. Imports of steel and aluminum from many countries have already been subject to a 25% tariff and 10% tariff, respectively, since former President Donald Trump invoked Section 232 in 2018, citing the importance of the domestic metals industries to national security and the threat that imports posed to the viability of these industries.

In the Feb. 24 statement, the White House also referenced the link between Russian-made aluminum and US national security.

"Russia remains the fifth largest source of imported aluminum in the United States, and the imports of aluminum from Russia have increased in both 2021 and 2022," the White House said. "Distortions that result from overcapacity threaten market-oriented aluminum industries and Russia's aluminum industry in particular is extremely export oriented, with Russia being the largest exporter of unwrought aluminum in 2021 and Russian domestic consumption accounting for just 22% of Russian production across 2021 and 2022."

The 200% tariff on aluminum is part of a wider slate of trade actions announced by the White House Feb. 24 that targets more than 100 Russian metals, minerals and chemical products worth about $2.8 billion.

Non-PNTR duties also raised

In a separate White House statement detailing the wider trade enforcement moves against Russia, the US said it would increase other duty rates that were applied when it revoked permanent normal trade relations with Russia in April 2022.

The PNTR revocation last year initially allowed the US to apply what are known as "column 2" tariffs on Russian-origin products. This included the imposition of an 18.5% duty on unwrought aluminum and 11% duty on high purity aluminum. The non-PNTR tariffs on multiple aluminum products were hiked to 35% in June.

With today's announcement, the White House said non-PNTR duties of 70% would now be imposed on Russian aluminum.

The Commerce Department said the new Section 232 tariff and higher PNTR suspension tariff will effectively "increase tariffs on Russian aluminum up to 270%, increasing pressure on Russia while minimizing costs on us and protecting our industries and workers."

"President Biden has made it a priority to mitigate the effects of Russia's invasion on domestic industries critical to our national security, and this includes the American aluminum industry," Commerce Secretary Gina Raimondo said in a Feb. 24 statement. "In imposing these tariffs, we are denying Russia an important market for its aluminum while taking a stand for America's workers."

The US imported nearly 210,000 mt of aluminum products from Russia in 2022 out of a total import volume of 6.36 million mt from all origins, according to aluminum import monitoring data compiled by Commerce's International Trade Administration. Imports from Russia represented about 3.3% of all import volume.

US aluminum imports from Russia in 2022 rose from about 180,000 mt in 2020, but have fallen drastically since they exceeded 750,000 mt/year in 2016 and 2017.