President Donald Trump on Tuesday signed an executive order aimed in part at strengthening the US' Buy America and Buy American laws, which precede his administration by decades.
The full text of Trump's "Buy American, Hire American" order was not immediately available Tuesday afternoon, but steelmakers were encouraged by the effort.
"Strong Buy America domestic procurement preferences for federally funded infrastructure projects are vital to the health of the domestic steel industry, and have helped create manufacturing jobs and build America infrastructure," Thomas Gibson, president of the American Iron and Steel Institute, said in a statement.
The Buy American Act of 1933, along with related laws and rules, governs direct purchases by the federal government, while Buy America, which dates back to the Surface Transportation Act of 1978, requires the use of US-made iron and steel. It also requires the domestic production and assembly of other manufactured goods when federal funds are used to support projects like highways, public transportation, aviation and intercity passenger rail.
Tuesday's order signed by Trump strongly reaffirms Buy America's melted and poured standard for US steel production, a senior administration official said in a press briefing Monday, adding that this standard remains under attack by foreign interests and lobbyists.
Semi-finished steel, such as steel slab, accounts for about 90% of the input costs of a finished steel product, and if a lesser standard than melted and poured were used, slabs could be imported from countries like China and Russia and only 10% of the production of steel would likely occur in the US, the administration official said.
"The foundation of a strong Buy America program is the longstanding requirement that all iron and steel-making processes occur in the US for a product to be Buy America compliant--from the actual steel production to the finishing processes," Gibson said. "This 'melted and poured' standard has been successfully applied since 1983 and must continue to be the standard used in federal Buy America rules for steel procurement."
Additionally, for the first time the Buy American bidding process will take into account the use of dumping and subsidization, the senior administration official said. The order will also look at how waivers of Buy American and free trade agreements may lead to non-reciprocal trade.
Trump has asked Commerce Secretary Wilbur Ross to review to submit a report to his desk within 220 days to serve as a blueprint for additional executive and regulatory actions to further strengthen Buy American, as well as guide possible legislative proposals.
"We applaud President Trump for affirming his commitment to full and effective enforcement of our Buy America laws, and to addressing the issue of unfairly dumped and subsidized steel, in signing this Executive Order today," Gibson said.
