25% tariff on imported steel!!? effect on knife prices

[leghog]

Look at the DOW today. All you need to know on tariffs.

Let's see what happens over the next 30 days.

 

[GB940Rookie]

I’m for whatever is best for our country as a whole.
MAP pricing is the thing killing knife purchases for me. The knife companies will probably use the tariff excuse to raise pricing another 8%.

 

[leghog]

Raw material costs is small compared to manufacturing costs.
Knives made from high performance stainless tool steels are expensive because it is a MOTHER to process, machine, and finish those types of materials.

Then you also have to consider the cost of the machines.

 

[unwisefool]

So what you are really telling me is to go buy a knife right now. Okay, you twisted my arm

 

[ExtremAddiction]

it will effect tooling cost as well , $1 here $1 there and you have completely different price ,
plus $ loosing its value so steady price increase year after year guaranty .

 

[FortyTwoBlades]

I would love to get FortyTwoBlades input on this?

My take is that it's not going to affect the knife industry much because it only impacts the cost of raw material. This will hurt American manufacturing companies using imported steel, but that will simply encourage them to produce knives using foreign-sourced finished or partially finished components. So, for instance, a company was making a knife in the USA using steel purchased from Germany, they might opt to have a German company make blade blanks out of it and then send that here instead, thus avoiding the tariffs since it's no longer raw material, but a partially-machined component part. Then the rest of the manufacturing would proceed as normal. That complicates the supply chain a bit, but has minimal overall impact for the same end result. BUT that offshores one step in the manufacturing process, so if bolstering American manufacturing is something we value then this hurts that. Other industries will be hit much worse, though, including automobile manufacturing and the oil/gas industry, since both rely on the availability of cheap steel in bulk.

 

[skyhorse]

Officials for the European Union have considered imposing a big tariff on Harley-Davidson imports from Wisconsin. This won't end well imho.

 

[jdm61]

If we go by standard pricing, Every dollar added to the cost of the tell in tariffs would generally be reflected by a price increase of $2.50-3 on the retail price. So that $2.30 become closer to $5.

 

[Lodd]

In truth, it's hard to say. If this sparks a trade war, it might have a bigger impact knife prices indirectly. It might also impact other factors such as availability (if the US economy takes a hit and some small businesses fold over).

 

[dirc]

in the short term, this will only increase the prices on Chinese knife imports - 8cr13, 9cr18, etc etc based blades of all knife companies 'value' lines

it might actually help the super steel knives, as they will likely see an uptick of volume which should reduce costs some...
I'm sure all the big companies will just add this to their profit lines, I don't expect they'll pass on any savings to customer prices

But yes, I agree, the retaliation across the world will be the interesting part, and will definitely be the real thing to worry about.

I'm not American, so I won't get into politics, but it's too bad that reforms like this (which may or may not be in the USA's long term interest) are happening under a shotgun approach. These types of things really ought to be done with a surgeons scalpel, not a shotgun, in order to minimize unintended outcomes.

Ford saw the impact of what massive steel production (and other heavy industries) does to local pollution levels, and made the bold move to not fight international trade wars over it. It did result in recession in the 70s while businesses were adapting to world production & economic realities.

As a result, the Yangtze is a toxic mess (as are most of China's rivers), while many American rivers and water systems have been improving since the 70s & 80s (until recently at least) http://wwf.panda.org/about_our_eart...cline/10_rivers_risk/yangtze/yangtze_threats/

I don't pretend to have long term answers, but heavy metals and other sludge really is best avoided in water systems. The world of business and industry ignored this aspect as it never cost them much in terms of actual bottom line impact. It's not an 'american' problem, it's a world problem, as industrial capacity far overwhelmed our early understanding of long term impacts. Science unfortunately lags behind in these situations... to our collective detriment.

It might be a good long term outcome to bring back heavy industry and steel production to the USA, but only if it doesn't result in heavy metals dominating water systems... I hope they find a sane balancing point. History says no such sanity exists when the bottom line is in jeopardy. I hope the companies running down this path have enough foresight to look beyond this quarter or fiscal year outcome to act intelligently. I don't expect gov't will enact any meaningful safeguards... so I'm not holding my breath.

I'm not a 'tree hugger', but I do think it's in all our collective interest to avoid heavy metals. (Unless you just like to listen to it of course

 

[uniemaia]

interesting thread, I also have the same question

 

[FortyTwoBlades]

in the short term, this will only increase the prices on Chinese knife imports - 8cr13, 9cr18, etc etc based blades of all knife companies 'value' lines

it might actually help the super steel knives, as they will likely see an uptick of volume which should reduce costs some...
I'm sure all the big companies will just add this to their profit lines, I don't expect they'll pass on any savings to customer prices

But yes, I agree, the retaliation across the world will be the interesting part, and will definitely be the real thing to worry about.

I'm not American, so I won't get into politics, but it's too bad that reforms like this (which may or may not be in the USA's long term interest) are happening under a shotgun approach. These types of things really ought to be done with a surgeons scalpel, not a shotgun, in order to minimize unintended outcomes.

Ford saw the impact of what massive steel production (and other heavy industries) does to local pollution levels, and made the bold move to not fight international trade wars over it. It did result in recession in the 70s while businesses were adapting to world production & economic realities.

As a result, the Yangtze is a toxic mess (as are most of China's rivers), while many American rivers and water systems have been improving since the 70s & 80s (until recently at least) http://wwf.panda.org/about_our_eart...cline/10_rivers_risk/yangtze/yangtze_threats/

I don't pretend to have long term answers, but heavy metals and other sludge really is best avoided in water systems. The world of business and industry ignored this aspect as it never cost them much in terms of actual bottom line impact. It's not an 'american' problem, it's a world problem, as industrial capacity far overwhelmed our early understanding of long term impacts. Science unfortunately lags behind in these situations... to our collective detriment.

It might be a good long term outcome to bring back heavy industry and steel production to the USA, but only if it doesn't result in heavy metals dominating water systems... I hope they find a sane balancing point. History says no such sanity exists when the bottom line is in jeopardy. I hope the companies running down this path have enough foresight to look beyond this quarter or fiscal year outcome to act intelligently. I don't expect gov't will enact any meaningful safeguards... so I'm not holding my breath.

I'm not a 'tree hugger', but I do think it's in all our collective interest to avoid heavy metals. (Unless you just like to listen to it of course

Chinese knives are a finished good. Not steel as raw material. This will mostly impact companies manufacturing in the US using steel imported from places like Sweden, Germany, etc.

 

[SharpieB]

The Canadian Govt is pissed as Canada supplies up to 20% of the US’ overall steel imports. Weird to see out Prime Minister rant about how this is totally unacceptable and threaten retribution.

Be interesting to see what happens if this includes Canada. More expensive Lagunitas, Jack Daniels and Spyderco for me, I guess.

 

[Lapedog]

Personally, I think all imported, finished goods (alloys are finished goods inasmuch as they are not a raw material like ores) should be subject to a tariff that fixes any trade deficits with the country supplying them. For instance, china should pay us to take their metal, since we are swamped by their cheap, poisonous, disposable plastic goods and electronics and arent allowed to sell in their markets without enormous tariffs on our goods.

It is bad policy to raise tariffs. Many american industries use that cheap imported steel to produce goods such as cars which can be sold to Americans for a lower price.

Even if a country raises tariffs against you it is not good to raise tariffs in response.

Here is a good example at a smaller level to help illustrate my point. Imagine there is a grocery store that has the lowest prices in town. For years you have built shelves for them and also have shopped with them.

Now imagine they say to you “sorry we can no longer buy shelving units from you” is it good for you to stop shopping with them just because they are no longer buying from you? Not unless you want to lose more money, they have the lowest price in town.