United States

Since returning to office, President Trump has issued numerous executive orders around immigration enforcement, trade tariffs and restructuring government departments. Elon Musk and the Department of Government Efficiency (DOGE) have been at the tip of the spear through cost and personnel reductions within government offices. Staff have been fired, rehired and asked to report their activities up to the DOGE. The writing is on the wall for some departments which could well be winding down most, if not all, of their activities. The consensus appears to suggest scope to eliminate waste but the methods adopted are sparking contentious debate.

It has been challenging to keep track of tariff developments, with manufacturers mostly against the new costs that these will bring. It is hard to tell whether these are negotiating tactics or real policy directions as some of the larger tariffs are getting delayed. There is concern that all this uncertainty may lead to economic troubles in the USA and to issues with our larger trading partners. All eyes are on inflation readings and employment figures, looking for evidence that the new policy approach may push us into uncharted waters.

Commerce across the borders was muted for the brief period during which the 25% across-the-board Mexico/Canada tariffs were in place, with automakers finally convincing President Trump to back off for now. These same tariffs have now been delayed until early April. The 25% aluminium and steel tariffs are in place at the time of writing but, in the current climate, there can be no guarantee that this will remain the case into the long term.

In the world of scrap, all markets are skittish about the ongoing trade wars given that aluminium, steel and copper are being targeted. Canada supplies more than half of primary aluminium usage in the USA and so the tariff is significantly impacting the regional premium, driving it 70% higher since President Trump re-entered office. Volatility in the premium has also been on the rise amid the rapidly shifting tariff landscape.

Scrap demand is still healthy in the USA. Profile and rolling mill scrap are still tight as the weather and limited production are reducing availability. Spreads for UBCs have finally come back down to earth as mills realised that melting primary was cheaper than using scrap, turning their backs on sustainability for the near term. All scrap aluminium prices have risen even as secondary ingot prices remain stable, thus putting a big pinch on the margins of secondary smelters.

There is not long to go to the BIR Convention in Valencia where we will announce the first recipient of our new Non-Ferrous Legends Award recognising individuals who have made exceptional contributions to our industry.