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The Nation’s Largest Nail Manufacturer Could Close Because Of Steel Tariffs

Oh no! The plant in Missouri laid off 60 workers last week because of increased steel costs.

Steel tariffs could force the nation’s largest nail manufacturer to close or move to Mexico.

The Mid-Continent Nail plant in Poplar Bluff, Missouri, laid off 60 of its 500 workers last week because of increased steel costs. The company blames the 25 percent tariff on imported steel. Orders for nails plunged 50 percent after the company raised its prices to deal with higher steel costs.

The company is in danger of shutting production by Labor Day unless the Commerce Department grants it an exclusion from paying the tariffs, company spokesman James Glassman told CNN’s Poppy Harlow.

Mid-Continent Nail is “on the brink of extinction,” he said.

hammer and nails photo
Flickr | Homedust

A Move To Mexico?

Glassman said the company might relocate to Mexico, where it could buy the steel without the tariffs — and then export the finished nails back to the United States without tariffs, which only apply to raw materials.

“It’s obviously an option,” said Glassman about moving to Mexico. “It absolutely is something this company does not want to do. It wants to save the jobs in Poplar Bluff, Missouri.”

steel plant photo
Getty Images | Lukas Schulze

Glassman called President Donald Trump’s trade policy misguided. He noted that the company had doubled its work force since 2013, and thrived despite increased competition from China.

About 21,000 U.S. companies have filed for tariff exclusions. In a June 20 Senate hearing, Commerce Secretary Wilbur Ross said Mid-Continent had filed a request for an exclusion only two days earlier.

wilbur ross photo
Getty Images | Chip Somodevilla

“I’m not belittling their situation at all. But given the importance of it to them, it’s very unfortunate that they waited all these weeks to file the request,” he said. “Under the authority we were granted, there is a process we have to follow.”

Jobs At Risk

The U.S. Chamber of Commerce has estimated that 2.6 million US jobs are at risk because of the Trump administration’s hard-line policies on trade, although that estimate includes the impact of ending NAFTA. The tariffs that have already been proposed could cost the U.S. economy about 700,000 jobs by next summer, according to Moody’s Analytics.

unemployment photo
Getty Images | Joe Raedle

The area of Missouri where the plant is located voted 80 percent for President Trump. Glassman said he can’t say whether people in town are still supporting the president.

trump supporters photo
Getty Images | Ralph Freso

“They are scared, they are worried about their families. It’s not like there are tons of other manufacturing jobs,” he said. “If I were a Mid-Continent worker, I would be extremely unhappy with what this administration is doing.”

Last week, Mid-Continent ran a full-page ad in a local newspaper, asking Trump for an exclusion from the tariffs. “More than any president in our time, you have shown compassion for U.S. manufacturing workers,” the ad reads.

Republican Congressman Jason Smith, who represents Poplar Bluff, has been a vocal Trump supporter. Meanwhile, Democrat Kathy Ellis, who is running for Smith’s seat this fall, said this issue could make some voters rethink their allegiance to the Republican party.


“The Poplar Bluff area is bright red. The strongest Trump supporters are going to go down with the ship,” Ellis told the St. Louis Dispatch. “Others may have buyer’s remorse.”

— Correction: An earlier version of this story incorrectly stated the number of jobs Moody’s predicted would be lost because of the currently announced tariffs.

Written by Chris Isidore for CNN. Additional reporting by Simplemost staff. 

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