The U.S. Department of Commerce recently announced on Aug. 15 that it would be adding 407 new tariff lines to the Section 232 steel/aluminum tariff lists — this includes many items made by farm equipment manufacturers, as well as key components and parts. These items are now subject to a 50% tariff on their steel and aluminum content, effective August 18.

To get the latest on this issue, Managing Editor Christine Book checked in with Daniel Fisher, senior vice president of government & external affairs at Associated Equipment Distributors (AED).

Fisher says this will have a substantial impact on the equipment industry and its customers — unnecessarily driving up costs and creating uncertainty. He shared details of what can be expected in the wake of these items now being subject to a 50% tariff on their steel and aluminum content. 

"In the immediate term, it creates a great deal of uncertainty. So there was no waiver or no leeway for if you had ordered the equipment already or if it was on the boat or it was in transit. So really effective on August 15th, was when this decision was announced. Effective August 18, these new tariffs took effect. So if you had ordered equipment, you had quoted equipment for a customer, that price was basically no longer valid almost immediately. So of course that creates a lot of uncertainty, certainly raises the cost on dealers purchasing the equipment, and of course the customers who are ultimately going to be the end user of the equipment. It increases compliance costs. These tariffs are extraordinarily hard to understand when you take the reciprocal tariffs, you take Section 232. In some countries, depending on the country, you may have Section 301 tariffs."

"Then if you're in the U.S. and Canada, you have the USMCA thing going on. And so it really just adds a great deal of compliance and complexity, which of course has added cost to it as well. And if you're not a major importer, it can be quite confusing even. It certainly is confusing for a lot of even customs brokers and others who are still trying to navigate the situation. And of course it's ultimately going to increase the cost on farmers, dealers, and OEMs when you have this imported equipment that is now subjected to a 50% tariff on the steel and aluminum content, which of course is a significant piece, portion of what is contained in the equipment."

AED is now focused on action items they’re urging OEMs and dealers to take in getting the message to elected officials in Congress to share with the Trump administration. 

"Obviously the ag sector has been hit particularly hard in recent times. This will only increase costs on the customers and it's just imperative that the entire equipment industry weigh in with their lawmakers and educate them about the impact this will have. And the hope is that a ground swell on Capitol Hill appears and that there's some pushback against the administration in terms of this expansive list of derivative products that are now included in the Section 232 tariffs."

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