Ongoing discussions between the United States and some of its trading partners about tariffs on imported steel and aluminum could loom particularly large for Missouri’s economy, according to a pair of recent reports from the Brookings Institution.
The Washington think tank projects Missouri would bear more of a burden from the U.S. tariffs — and potential European Union retaliation — than almost any other state, due to Missouri’s heavy reliance on imported aluminum and steel, and to the types of products the state exports to Europe.
The 25 percent tariff on steel and 10 percent levy on aluminum imports that President Donald Trump announced earlier this month took effect on March 23, but Trump granted temporary exemptions to Argentina, Australia, Brazil, Canada, Mexico, the EU and South Korea. A presidential proclamation gave those trading partners until May 1 to negotiate a “satisfactory alternative” to the tariff.
However, the run-up to those exemptions offered a glimpse of what impact the full tariffs could have.
According to a Brookings report released before Trump announced the exemptions, the higher price of steel and aluminum imports caused by the tariffs would have ripple effects “for industries as diverse as auto manufacturing, brewing, and construction.”
Missouri would feel those effects more acutely than any other state, according to the report, because steel and aluminum make up 7.4 percent of Missouri’s imports. That’s the highest figure of any state in the country, and it’s more than triple the national average of 2.0 percent.
If the U.S. and EU can’t reach a deal, American exporters may have to contend with barriers to their deliveries to the European market: On March 16, the European Commission released a list of American products on which it would impose tariffs as retaliation for Trump’s trade measures.
The EU’s list included aluminum and steel, but it also featured consumer goods from all types of U.S. industries, including cotton shirts, orange juice, playing cards and motorcycles. Some of these products were chosen specifically to hit industries that are prominent in the home districts of top Republican legislators.
Yet again, Missouri would be hit harder than almost any state, according to another Brookings report. That report, also released before Trump announced the exemption, projected that 10.7 percent of all Missouri exports to the EU would be at risk if Europe retaliated with tariffs.
The only states hit harder, according to Brookings, would be Hawaii and Michigan. The average state’s exposure to the European tariffs would be about 3 percent.
Michael Stacy contributed to this report.