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article imageU.S. investigating uranium imports as Canada holds its breath

By Karen Graham     Jul 18, 2018 in Politics
In the latest use of the 1962 trade law to scrutinize imports, the U.S. Commerce Department is opening an investigation into whether imports of uranium — the chemical element that fuels nuclear power — pose a risk to national security.
The Trump administration is invoking a clause in U.S. law called Section 232 of the 1962 Trade Expansion Act. Designed to be used during the heightened tensions of the Cold War, it has rarely been invoked - until recently when someone on Trump's staff told him how he could declare tariffs on foreign imports if they are deemed to "threaten to impair the national security" of the U.S.
The administration has used the clause to impose steel and aluminum tariffs on Canada and other trade partners and U.S. Commerce Secretary Wilbur Ross is still investigating imported automobiles and auto parts because they might pose a threat to our national security.
But Ross has been given a new task - after two American uranium producers, Energy Fuels and Ur-Energy petitioned the Commerce Department to open a so-called Section 232 investigation into whether "the dominance of imports in the U.S. uranium market raises national security concerns."
US Commerce Secretary Wilbur Ross is said to have held assets linked to Russia and China that are co...
US Commerce Secretary Wilbur Ross is said to have held assets linked to Russia and China that are coming under scrutiny
Greg Baker, AFP/File
The petition was filed jointly by the companies on January 16, 2018. With the initiation of the investigation beginning today, July 18, 2018, the Commerce Department has 270 days to conduct the investigation and submit a report to the President of the United States containing the Secretary's findings and proposed remedy, if any.
Following receipt of the Secretary's report, the President then has up to 90 days to act on the Secretary's recommendations and, if necessary, take action to "adjust the imports of an article and its derivatives" and/or pursue other lawful, non-trade-related actions necessary to address the import threat, according to a news release by the two companies.
Ross says the investigation will cover "all aspects of the uranium industry," from mining to enrichment, defense and uses by industry. The department also consulted with industry stakeholders, members of Congress and the departments of Defense and Energy prior to launching the probe.
Ranger uranium mine
Ranger uranium mine
2002 Dustin M. Ramsey (CC BY-SA 2.5)
“Our production of uranium necessary for military and electric power has dropped from 49% of our consumption to 5%,” Commerce Secretary Wilbur Ross said in a statement. “The Department of Commerce’s Bureau of Industry and Security will conduct a thorough, fair, and transparent review to determine whether uranium imports threaten to impair the national security.”
Uranium in Canada - Additional tariffs?
According to the World Nuclear Association, Canada was the world's largest uranium producer for many years, accounting for about 22 percent of world output, but in 2009 was overtaken by Kazakhstan.
Most all of Canada's production comes from the McArthur River and Cigar Lake mines in northern Saskatchewan province, which are the largest and highest-grade in the world. And Canada is rich in uranium resources. By 2014, more uranium had been mined in Canada than any other country – 485,000 IU, about one-fifth of the world total.
File photo of the BHP Billiton Olympic Dam copper and uranium mine in South Australia
File photo of the BHP Billiton Olympic Dam copper and uranium mine in South Australia
, BHP Billiton/Skyscans/AFP/File
Saskatoon-based Cameco Corporation mined almost 24 million pounds of uranium last year, and almost 80 percent of it was sold to the U.S., according to data compiled by Bloomberg. However, two of Cameco's mines are in the U.S. - Crow Butte and Smith Ranch-Highland. The two U.S. mines have the capacity to produce up to 3 million pounds a year.
In a news release, Cameco CEO Tim Gitzel said, "We will need to see what the investigation finds, if any trade action is recommended, and what specific remedies might be pursued before the potential impact, positive or negative, can be determined."
“If the issue in question is the over-reliance of the United States on uranium supplied by state-controlled enterprises from countries not aligned with American policy interests, this clearly does not apply to Canada or Cameco,” Gitzel said.
McArthur River Uranium mine  looking South East.
McArthur River Uranium mine, looking South East.
Tariff fears may be warranted
The big complaint from the two U.S. companies has to do with "state-subsidized" uranium imports. "Despite uranium’s critical role in supporting clean electricity and national defense, imports of cheap, foreign state-subsidized uranium have swelled in recent years to the point that domestic suppliers currently provide less than 5 percent of our nation’s demand," the companies said in a statement.
The petition also recommended setting a quota that would limit uranium imports and assure U.S. producers provide about 25 percent of the nation's supply. They are not specifically asking for tariffs to be imposed - they just want a chance to compete with foreign imports. Bottom line? We will wait and see. .
More about Uranium imports, National security, US Department of Commerce, Tariffs, Canada
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