Paul Aucoin is uncertain at this time about the impact of President Donald Trump’s tariffs push on the Port of South Louisiana, but he does fear it could ignite a trade war that could affect everyone.
“You put a tariff on me and I put a tariff on you, and the consumer pays more,” said Aucoin, the port’s executive director. “We stop buying then the economy tanks. That’s the consequences of a trade war.”
Last Thursday, Trump signed the order that imposes tariffs on steel and aluminum imports on all foreign countries except for Canada and Mexico at this time while negotiations for the North American Free Trade Agreement, better known as NAFTA, are underway.
Nucor Steel Louisiana and Bayou Steel, which stand to gain from higher steel prices, are both in the port district.
“It’s hard to say (the effect this will cause) at this point in time,” said Aucoin, who noted he hasn’t seen changes like these in his five years with the port. “I’ve read articles indicating the petrochemical industry will suffer, but that depends on whether we get into a trade war.”
Aucoin said Trump’s order did “leave some wiggle room” in that countries can seek waivers on the tariffs or appeal them, which means watching how this plays out.
He added, “That leaves the door open to preventing a trade war because it’s just a bad thing that we don’t need right now.”
Overall, he said it’s hard to gauge the potential effect these tariffs will have on industries in the port.
“I’m always going to be optimistic that the steel companies will benefit, but I may be wrong,” Aucoin said. “Some are pessimistic that they will hurt the economy with a trade war. For every action there’s a reaction.”
He anticipates steel and aluminum companies will benefit from the move, but he also warned it depends on how other countries react to the tariffs.
The port’s biggest trade countries are Canada, Mexico and China, but Aucoin said that could change if the price of goods rises.