U.S. Plans Uranium Import Probe That May Lead to Tariffs
Uranium investigation would add to trade tensions that the IMF warns represents the biggest risk to global economy.
(Bloomberg) -- The Trump administration plans to open an investigation into whether uranium imports are harming national security, a move that could lead to tariffs on foreign shipments of the metal, said three people familiar with the matter.
U.S. uranium producers Energy Fuels Inc. and Ur-Energy Inc. filed a petition in January asking the Commerce Department to investigate the matter under Section 232 of the 1962 Trade Expansion Act, the same provision the president used to slap tariffs on steel and aluminum imports. U.S. industry wants the government to shield it from competition from state-owned companies in countries including Russia and Kazakhstan.
The timing of the probe remains unclear, said a person familiar with the matter, who spoke on condition of anonymity because the deliberations aren’t public. Some administration officials are debating whether to wait until the controversy blows over from President Donald Trump’s meeting in Helsinki with Russian President Vladimir Putin on Monday.
The Commerce Department declined immediate comment.
A uranium investigation would add to trade tensions that the IMF warns represents the biggest risk to the global economy. Imposing uranium duties would deal another blow to nuclear power plants already struggling with low electricity prices and flat demand.
However, U.S. miners supply less than 5 percent of domestic consumption for the metal, and they argue it’s increasingly difficult to compete with state-subsidized companies in Russia, Kazakhstan and Uzbekistan.
“The global uranium market is not a level playing field,” said Paul Goranson, chief operating officer of Energy Fuels. “It’s put the country at a real risk, because we’re increasingly dependent on these state-owned companies which obviously have different global strategic objectives than we do.”
U.S. producers want about 25 percent of the domestic market to be reserved for American miners, which produced about 1.2 million pounds last year, the lowest in at least 25 years.
Commerce Secretary Wilbur Ross told the Senate Finance committee last month that he would make a decision on the uranium probe “very shortly.” “It’s complicated by some prior agreements that exist but we are sorting through it and we will come to a conclusion very, very quickly,” Ross said.
Canada and Kazakhstan are the main sources of U.S. uranium imports, each accounting for about a quarter of the total, followed by Australia, Russia and Uzbekistan, according to the U.S. Energy Information Administration. Almost 90 percent of uranium delivered to U.S. reactors was from foreign nations in 2016, according to the government agency.
--With assistance from Jenny Leonard.
To contact the reporters on this story: Jennifer Jacobs in Washington at jjacobs68@bloomberg.net;Andrew Mayeda in Washington at amayeda@bloomberg.net;Jim Efstathiou Jr. in New York at jefstathiou@bloomberg.net;Joe Deaux in New York at jdeaux@bloomberg.net
To contact the editors responsible for this story: Brendan Murray at brmurray@bloomberg.net, Sarah McGregor, Alister Bull
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