USMCA expected to benefit metal manufacturers

With USMCA, the biggest change is likely to benefit metal manufacturers in automotive supply chains. Getty Images

The Senate will pass the U.S.-Mexico-Canada Agreement (USMCA) sometime in the very near future. When the trade agreement goes into effect, manufacturers of metal goods, particularly those that supply parts to the automotive industry, will see some major changes from the previous North American Free Trade Agreement (NAFTA), which first went into effect Jan. 1, 1994.

The biggest change is a 70% “regional value content” (RVC) for steel and aluminum in autos and a separate list of other products. There was no such requirement in NAFTA.

Some metal product categories, such as chains and wire, were included in NAFTA and subjected to some rules, although not the steel/aluminum RVC rules. Other product categories were not touched by NAFTA but have been brought into the USMCA:

• Nails, tacks, drawing pins, corrugated nails, staples, and similar articles of iron or steel
• Certain welded tubes and pipes, fittings, and tool joints

The National Association of Manufacturers and the Precision Metalforming Association, among many others, support the USMCA.

Concerns About the EPA Proposal on Metal Parts

Various metal fabrication sectors are concerned about the Environmental Protection Agency’s proposed changes to air emission requirements governing hazardous air pollutants for companies doing surface coating of metal parts.

We previously noted that an EPA-proposed rule from last fall made no significant changes in emission limits for metal parts manufacturers, nor for automobile and metal furniture manufacturers, either. That was the good news. All those sectors were rolled into one large rulemaking. However, complaints have emerged from other sectors of the metal manufacturing community about some of the new requirements that are proposed.

The slightly significant changes the EPA is proposing include amending provisions that address emissions during periods of startup, shutdown, and malfunction (SSM); that cover electronic reporting of performance test results; and that cover monitoring requirements. Some of these changes could be problematic, according to public comments submitted in the aftermath of the proposed rule. For example, Mike Cassidy, manager, EHS technical resources, Kohler Co., cited one new requirement that initial notifications, performance test results, performance evaluation reports, and semiannual reports using the new template should be submitted electronically through an electronic reporting tool called Compliance and Emissions Data Reporting Interface (CEDRI).

“Reporting through CEDRI should not be required for sources in states delegated to administer/enforce the NESHAP, unless required by that specific state,” he told the agency. NESHAP stands for National Emission Standards for Hazardous Air Pollutants.

Philip Squair, vice president, government relations at the National Electrical Manufacturers Association (NEMA), voiced a narrow concern with regard to how the SSM provisions affect magnet wire facilities. As is often the case with the EPA, it has taken its time implementing a court decision, in this case one from 2008 in Sierra Club vs. EPA, that requires some changes in the SSM provisions. But what the EPA is proposing will make it “challenging to find a methodology for emission calculations during SSM periods,” according to Squair. That could be true too for other fabrication sectors.

David Darling, vice president, health, safety, and environmental affairs, the American Coatings Association, suggested that the EPA clarify that the proposed requirement to conduct performance tests every five years so that it applies only to control devices and that the timing of the tests should be aligned with Title V operating permit requirements. In addition, EPA should also allow for testing extensions for facilities that need additional time to obtain representative conditions.