U.S. Senator Claire McCaskill, D-Missouri, says a southeast Missouri nail factory could be forced to close while it waits for the federal government to decide about its tariff exclusion requests.
In a press release this week from McCaskill about President Trump’s ongoing trade war, she cites Mid Continent Nail Corporation in Poplar Bluff slashing at least 160 jobs since Trump’s 25% tariff on steel imports began in June. Before June 1, the company employed some 500 workers.
Mid Continent is owned by Mexico-based Deacero. The parent company produces steel and ships the material to its own plant in Poplar Bluff. Mid Continent wants exemptions granted that would allow the factory to get raw materials from Deacero without being taxed 25%.
The tariff exclusion process is a long, drawn out ordeal for American companies. The U.S. Commerce Department has been overwhelmed with about 20,000 requests – leading to a major backlog and putting many U.S. businesses in financials binds.
In mid-August, Mid Continent officials met with U.S. Commerce Secretary Wilbur Ross to plea for immediate exemptions. During a press call earlier this month, Operations Manager Chris Pratt said if exclusions don’t happen soon, a critical business decision will have to be made.
“Can I tell you that we can last until the end of September? No. What I can tell you is that if we don’t get immediate relief, we can be shut down in the next 20 to 30 days. Sooner rather than later keeps our company from losing money every day,” he said. “We made a commitment back in June to keep our company open to incur significant losses day in and day out. We are actually keeping employees that we actually do not need to produce product. We are keeping them on staff, paying their wages, providing them with benefits and things of that nature, in hopes that our Administration will follow through with what is hopeful, which is to grant our exclusions.”
The Poplar Bluff company is the last major U.S. nail supplier and has been in business for 31 years. It had to increase its prices by about 19% and many of their loyal customers disappeared almost immediately after the tariffs launched. Buyers have been compelled to purchase cheaper nails elsewhere, like in China and India.
“Within a two-week period, 70% of our orders for June were gone,” he said.
Pratt said he’s tried to work out a deal with U.S. steel suppliers to help keep his company’s prices down.
“We’ve asked several of the major steel suppliers in the country for bids,” he said. “They can only offer about 10% of what I need on a monthly basis.”
Poplar Bluff is located in Trump country. In 2016, the Republican president won Butler County by 79%.
(Alisa Nelson, Missourinet)