The Case for Specific Tariffs: Large-Diameter Steel Pipe Tells the Story

When the trade deficit goes down, that must mean good news for American manufacturers, right? No, that can’t be assumed. In the year since Liberation Day, a familiar pattern has played out: the value of imports decreased, while the actual quantity of imports increased.

The issue is now gaining mainstream attention. Most recently, the New York Times published an overview titled “‘Definitely a Sham’: As Tariffs Climb, Trade Fraud and Accounting Tricks Proliferate”

A striking example of this rampant undervaluation phenomenon is big steel pipe, the kind that moves oil and water across the country. Census Bureau data through February 2026 shows plainly: foreign producers responded to the higher ad valorem rate by cutting their declared customs values, not cutting shipments. The tariff went up; the actual duty collected per kilogram went down.

What the Data Shows

HTS Heading 7305 covers welded steel pipe with an outer diameter exceeding 406.4 millimeters—roughly 16 inches. These are transmission-grade line pipes, structural pilings, and large-bore casings used in energy and infrastructure projects. In March 2025, President Trump effectively restored the steel tariff by doing away with all the country exemptions. So comparing the two before and after twelve-month periods—March 2024 through February 2025 versus March 2025 through February 2026—reveals a striking pattern:

Metric	Mar ’24–Feb ’25	Mar ’25–Feb ’26	Change
Total Annual Import Value of large steel pipe:	$810.3M	$704.9M	−13.0%
Total Annual Import Quantity (kg) of large steel pipe:	424.9M	491.6M	+15.7%
Average Declared Value per Kilogram:	$1.91/kg	$1.43/kg	−24.8%
Actual Cost of Steel (Domestic Plate PPI (BLS)):	242.5 avg	256.6 avg	+5.8%

Source: U.S. Census Bureau, International Trade data (HS10 level); BLS Producer Price Index, Fabricated Steel Plate (WPU10760102).

Read the table from bottom to top. The cost of fabricated steel plate—the primary input for welded pipe—rose over the period. Raw material got more expensive. Yet the declared value of imported pipe fell nearly 25 percent per kilogram. More pipe arrived at lower declared prices, even as the input costs to make that pipe were climbing.

The Ad Valorem Problem

An ad valorem tariff is assessed as a percentage of the declared transaction value—whatever the importer claims they paid overseas. When the declared price drops, the duty drops with it. That’s the fundamental vulnerability. A 50 percent tariff on $1.91 per kilogram collects $0.95. A 50 percent tariff on $1.43 per kilogram collects only $0.71. The foreign producer cut its declared price by a quarter, and the effective duty fell by a quarter with it. The tariff rate didn’t change. But the protection did.

The Fix Is Already in the Toolkit

A specific tariff—assessed per kilogram, per unit, or per meter—doesn’t care what the invoice says. It cares what shows up on the scale at the port. If the specific rate were set at, say, $0.95 per kilogram to match the original effective protection, it would have collected $0.95 on every kilogram regardless of whether the exporter declared $1.91 or $0.50. The protection would have held.

This isn’t a novel idea. It’s one of the oldest ideas in American trade policy. The Tariff Act of 1789 set duties at “50 cents per pair of boots” and “4 cents per pound of cheese.” Henry Clay championed specific duties over ad valorem rates precisely because the latter were, in his words, magnets for “false valuations” and “double invoices.” The logic was simple: if the duty is determined by weight, no one can lie about the weight. Everyone pays the same tariff.

The administration has already shown it knows how to do this. The September 2025 Section 232 proclamation on wood products directed Commerce to develop a process for producers to request conversion from ad valorem rates to equivalent specific or compound rates. That framework should be extended to steel and aluminum immediately—starting with the HTS lines where the data shows the most aggressive unit-value erosion, like 7305.

Weigh It at the Port

The Heading 7305 data tells a clear story. Input costs went up. Import volumes went up. Yet importers’ declared values went down—and with it, the actual tariff collected per unit. This is exactly what ad valorem tariffs invite, and exactly what specific tariffs prevent. Commerce has the authority and the template. Stop letting overseas paperwork set the duty owed. Weigh it at the port.