Trump's tariffs may have forced a US steel company into bankruptcy.

Donald Trump likes to boast that his tariffs have saved the US steel industry from collapse. "Steel was dead," he told a crowd of Pennsylvania employees in August. “Your business was dead. All right? I don't want to be too raw. Your business was dead. And I put a little thing called 'a 25 percent duty' on everything from dumped steel across the country. And now your business is thriving. "

However, back in the real world, it has become increasingly clear that tariffs have done little to lift the industry's wealth overall, and that they have gained a good back for some manufacturers. For example, on Tuesday, Bayou Steel Group filed for bankruptcy in Chapter 11 and announced that they would close the facility near New Orleans. Nearly 400 workers there lose their jobs. A smaller facility in Tennessee, with 72 employees, will also close.

The company did not offer a detailed explanation of the bankruptcy. (It cited a "severe lack of liquidity," meaning it lacked cash to continue operating.) But, as Bloomberg reports, Louisiana's Democratic Gov. John Bel Edwards fingered Trump's trade war as a likely culprit. "Although Bayou Steel has not given any specific reason for the closure, we know that this company, which uses recycled scrap metal that is largely imported, is particularly vulnerable to tariff rates," he said in a statement. "Louisiana is among the most dependent states on tariff metals, which is why we continue to be hopeful for a quick solution to the uncertainty about the tariff's future."

This is a slight variation on a problem that many critics saw when Trump announced his tariffs last year. While many US steel companies produce the raw metal from scratch, not many of them. Instead, they specialize in making steel products from cheap, semi-finished sheets of the material they buy from abroad. The fees posed a serious threat to that segment's business model. The administration has tried to skirt this problem by granting companies waivers that allow them to import steel from countries such as China and Japan duty-free, but the process has been contentious and has sometimes led to funny results, such as when a steel company that used a years of praising Trump's tariffs, the administration later sued after it was denied exemption from them.

This brings us to the broader point: Trump's trade war has not so much brought the steel industry back to life as it has mixed about the winners and losers. In the wake of tariffs, steel prices rose significantly, leading to a boom in production. But as domestic steel quickly flooded the market, prices fell back to earth. As Bloomberg has reported, it has created division in the industry. Companies like Nucor, which can compete effectively for price because electric factories are relatively cheap to operate, have done quite well. But the U.S. Steel, with ancient stoves, has got sock; The share value is down by around 75 per cent since March last year, and the company has had to idle for facilities. In the midst of all this turmoil, the industry has added just a few thousand jobs, which has come at a serious cost to companies such as automakers using US steel as input.

We will probably learn more about exactly what happened at Bayou Steel in the coming weeks. But for now, it seems like an example that Trump, rather than saving some steel companies from death, can punish them for it.