Pacific Northwest industries are uncertain about the impact of Trump’s proposed tariffs.
In the Pacific Northwest, many industries were cautiously assessing the impact of President Donald Trump’s tariffs on imported steel and aluminum.
Alcoa, which has an active aluminum smelter in Ferndale and an idled one in Wenatchee, took issue with the blanket nature of the proposed import tariff in a statement: “We believe vital trading partners, including Canada, should be exempt from any tariff on aluminum. The aluminum industry has an integrated supply chain and actions should not penalize those that abide by the rules.”
The state’s wheat farmers, meanwhile, are concerned about retaliatory tariffs that could affect their exports.
“Sometimes ag is the easiest retaliatory product that countries say, ‘Oh, okay, you’re slapping a tariff on our steel, well then we’re going to slap a tariff on your wheat or soybeans or corn or apples or wine’ — all the stuff that we produce,” said Glen Squires, CEO of the Spokane-based Washington Grain Commission.
The wheat industry is already facing turmoil from the Trump administration’s decision to abandon the Trans Pacific Partnership, imperiling access to some of the biggest buyers of Northwest wheat in Asian countries such as Japan. About 90 percent of Washington wheat is exported, and about 75 percent of it goes to Asia, Squires said.
The U.S. gets much of its imported steel and aluminum from countries that are also among the best customers for wheat. Mexico, for example, a large steel provider, is also the top market for U.S. wheat. South Korea, another steel provider, is consistently the No. 3 export market for Northwest wheat.
“If we have tariffs because of some retaliation, they’ll go elsewhere,” Squires said. “That would be a big problem for us.”
Jeff Tomson, marketing director at Machinists Inc. in Seattle’s South Park neighborhood, said that on the company’s commercial contracts for aerospace tooling and other heavy equipment, “we use steel from all over the world.”
“I’m sure we’ll be seeing cost increases,” Tomson said, though he added that it’s not clear this would hurt his business. “The people I complete against are mostly U.S.-based manufacturers, so the pricing should be equitable.”
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The steel tariffs mean “the cost is going to go up” for Seattle’s high-rises, but “it’s tough to say how much,” said Todd Weaver, president of Spokane-based Metals Fabrication Co., one of the biggest steel fabricators for the Seattle market. About 90 percent of his steel is domestic, he said, but higher costs for foreign firms could give domestic suppliers cover to raise their prices.
Mike Pattison, government affairs manager for the local Master Builders Association, said that if the full cost of the tariff is passed on to homebuilders, it would raise costs by about $3,000 to $5,000 per home. Houses aren’t often built with steel, but the infrastructure needed to build a new house, like water mains, is.
He said the cost of building materials has already been “skyrocketing.” Ultimately, those costs get passed down to the homebuyer.
“It’s only adding to our overall affordability problem,” Pattison said.