President Donald Trump said falling aluminum prices are evidence that his tariffs aren't impacting the U.S. economy.
But in reality the price of the metal declined because he exempted Canada and Mexico from the tariffs.
"Despite the Aluminum Tariffs, Aluminum prices are DOWN 4%. People are surprised, I'm not! Lots of money coming into U.S. coffers and Jobs, Jobs, Jobs!," Trump tweeted Friday.
Trump signed his steel and aluminum tariff proclamations on March 8 that excluded Canada and Mexico and also left the door open to other countries to ask for exemptions. As a result, the general spot aluminum price fell.
LME aluminum price year-to-date chart
But industry observers pointed out a key measure of aluminum for local U.S. producers did not decline much at all.
The price of Midwest premium aluminum, which is the difference between the general aluminum spot price and total price paid by local U.S. buyers, more than doubled since Jan. 1 in anticipation of tariffs to 19 cents per pound Thursday, according to data from American Metal Market and BMO Capital Markets. The price is only half-a-cent per pound lower than its year-to-date highs in March.
Midwest premium price represents the cost of transporting aluminum from the overseas into the U.S., after factoring in transport costs, taxes and the potential impact from tariffs.