The American aluminum industry has been a subject of considerable debate and policy intervention in recent years, particularly concerning the role of tariffs and international trade. A recent op-ed by Peter Navarro, former White House senior counselor for trade and manufacturing, paints a vivid picture of the industry’s struggles and the potential for a resurgence under a revised trade strategy. Navarro’s piece argues that tariffs implemented by President Donald Trump in 2018 provided a much-needed boost to American aluminum producers, while subsequent policy adjustments under President Joe Biden led to a decline in the industry’s health. Now, with Trump again taking a protectionist stance, the future of American aluminum hangs in the balance.
Navarro begins by highlighting the purported positive effects of the Section 232 tariffs on aluminum and steel imposed by the Trump administration. He claims these tariffs were crucial in protecting American producers from unfairly priced imports that posed a threat to national security. The immediate impact, according to Navarro, was significant. Century Aluminum, a major American producer, restarted idle production lines, Alcoa expanded its operations, and overall U.S. aluminum production experienced a surge. This, in Navarro’s view, signified the rebirth of a critical industry vital to national security.
However, Navarro criticizes President Biden’s approach to trade, alleging that the administration’s granting of exemptions and alternative trade arrangements severely undermined the effectiveness of the Trump tariffs. He argues that these policy shifts led to a resurgence of imports, causing a decline in U.S. aluminum capacity utilization, smelter shutdowns, and job losses. According to Navarro, by 2024, U.S. aluminum capacity utilization had plummeted to a concerning 52%.
The author then praises President Trump’s decision to raise the aluminum tariff from 10% to 25% while eliminating country-specific exemptions. This decisive move, in Navarro’s opinion, signals the end of unchecked imports that have been undermining American industry. He asserts that the United States will no longer serve as a dumping ground for heavily subsidized and unfairly traded aluminum.
Navarro anticipates criticism from foreign nations regarding the new Trump tariffs, but dismisses these concerns by arguing that those who benefited from exemptions or alternatives to the tariff abused the privileges granted to them by the United States. He contends that not only strategic competitors like China and Russia, but also nations considered U.S. allies, have exploited exemptions and loopholes to flood the U.S. aluminum market.
Navarro then provides specific examples to support his claims. He criticizes Australia, arguing that its heavily subsidized smelters operate below cost, giving them an unfair dumping advantage. Furthermore, he suggests that Australia’s close ties to China distort global aluminum trade. While voluntary restraint agreements initially kept Australian exports in check, Navarro claims that exports surged once Biden took office. He notes that in 2024, Australian capacity utilization reached 90%, while American capacity utilization plummeted to nearly 50%.
Canada also comes under scrutiny. Navarro points to Canada’s massive aluminum overcapacity and its historical tendency to export the bulk of its aluminum to the United States. He alleges that this influx of Canadian aluminum has had severe consequences, forcing Alcoa to idle its Intalco smelter in Washington state, and causing other U.S. smelters to struggle to remain profitable, even as the Canadian arm of Alcoa has prospered. He further asserts that Alcoa and Rio Tinto, which dominate both Canadian and Australian aluminum markets, have strategically shifted exports to the United States between the two countries to maximize profits, with China being the largest Rio Tinto shareholder.
Mexico is accused of becoming a critical entry, transshipment, and tariff evasion point for foreign aluminum producers seeking to bypass U.S. trade restrictions. Navarro claims that countries like China, Russia, India, and the United Arab Emirates have funneled massive amounts of aluminum into Mexico, processing it into products like extrusions before shipping it tariff-free into the United States. As a result, he argues, U.S. aluminum extruders have struggled to compete, leading to layoffs and plant closures. He also highlights that Chinese firms have aggressively expanded their Mexican operations, investing heavily in extrusion plants that serve as a conduit for tariff-free exports to the United States.
Argentina is also criticized for its primary aluminum producers’ reliance on heavy government subsidies, which Navarro believes distorts prices in the global market. He claims that Argentine exports are now significantly higher than before the initial Trump tariffs were imposed in 2018, and that Aluar Aluminio, Argentina’s dominant producer, has restarted idled capacity, potentially leading to even more aluminum flooding the U.S. market.
Finally, Navarro addresses the European Union and the United Kingdom, claiming they have taken full advantage of their ability to ship aluminum to the United States without restriction. He notes that the EU’s exports to the United States have climbed above $3 billion per year and are now higher than before the 2018 tariffs were implemented. He accuses European producers of engaging in the same "subsidize and dump" practices seen with both aluminum and steel exports to the United States, with European producers restarting idled capacity in countries like Germany and France, backed by extensive government subsidies.
Navarro concludes by asserting that President Trump is writing a new chapter for the United States, one where the Biden era of idled smelters and declining capacity utilization will come to an end. He envisions a golden age of American aluminum production regaining its rightful place as a pillar of national security and economic strength. He frames this as more than just a trade battle, but as a fight for the survival of an essential American industry.
Navarro’s op-ed presents a highly partisan view of the aluminum trade issue. It champions President Trump’s protectionist policies as a solution to the industry’s woes, while criticizing President Biden’s approach as detrimental. His arguments are based on specific data points and anecdotes, but it is important to note that the complexities of international trade and the aluminum industry are multifaceted. A comprehensive analysis would require considering various perspectives and factors, including the impact of tariffs on consumers, the potential for retaliatory measures from other countries, and the overall global economic context.
