Issue Briefs

Download IME's Tariff One Pager

The commercial explosives industry operates within a highly integrated global supply chain, relying on critical inputs sourced both internationally and domestically. While some materials can be produced within the U.S., domestic supply is often limited and, in some cases, non-existent. Competition from the defense sector further constrains the availability of some materials.

Tariffs on key imports negatively impact not only the explosives industry but also the critical industries that rely on it - including the $121.7 billion mining and critical minerals industry, the $2.2 trillion quarrying and construction industry, and the $818.2 billion energy industry. Higher input costs due to tariffs raise the prices on goods and services throughout the economy, impacting key Administration priorities and driving up expenses for American businesses – costs that eventually fall on consumers.

Commercial Explosives Key Inputs

High Explosives (HMX, RDX, HNS, PETN, TNT)

The U.S. remains heavily dependent on foreign sources for high explosives such as HMX, RDX, HNS, and TNT—core ingredients in many commercial explosive products.

• HMX, HNS, and RDX, classified under Chapter 36 of the Harmonized Tariff Schedule, are imported primarily from Norway, Sweden, Poland, Germany, China, South Korea and other nations.
• TNT is not presently produced in the U.S. Though a domestic production facility is planned, current sources of TNT include Turkey, China, Vietnam, Australia and India; due to geopolitical tensions, traditional sources like Poland and Ukraine are no longer reliable.

Ammonium Nitrate and Ammonia

Over 90% of commercial explosives consumed in the U.S. are ammonium nitrate (AN) based due to AN’s safety and relatively stable domestic supply. While the U.S. produces AN, domestic production is not sufficient to meet the overall demand. Importing AN helps the U.S. stabilize the supply chain and manage price fluctuations in the domestic market. AN is imported from Canada, due in large part to transportation logistics, as well as Russia, Vietnam, China, the Netherlands, Mexico and other nations.

Anhydrous ammonia is the basic building block for all nitrogen products. Ammonia is currently produced at 35 plants in 16 states.[1] While U.S. production capacity for ammonia is strong, we import product from Canada, again, based on logistics, as well as Trinidad and Tobago, Algeria, Indonesia, Belgium and other countries.

Detonating Cords, Caps, and Fuses

Detonating cords, detonators, and safety fuses are vital components in explosive systems.

• These are sourced both domestically and internationally from Mexico, Canada, Brazil and other countries.
• Despite some domestic manufacturing, imports remain necessary to meet demand.

Steel and Aluminum

The commercial explosives industry is reliant on a specific steel alloy necessary for the manufacture of perforating guns used in the oil and gas industry. The steel needed for the manufacture of this important tool for oil and gas extraction, is primarily sourced from China and is not produced in the US.

IME’s Asks of Congress:

To strengthen domestic industries and maintain cost-effective operations, the following inputs should be exempt from current and future tariffs:

• High explosives: HMX, HNS, RDX and TNT
• Key chemical components: Ammonia, Ammonium Nitrate
• Essential raw materials: Specialized Steel Alloy

Exempting these materials from tariffs will stabilize supply chains, maintain competitiveness, and support core industries that drive the American economy. Alternatively, increasing tariffs that impact the explosives industry will disrupt well established supply chains. This could lead to more cautious spending and delayed investments in U.S. based mining companies.

[1] https://pubs.usgs.gov/periodicals/mcs2022/mcs2022-nitrogen.pdf

Download IME's ATF Modernization Fact Sheet

The commercial explosives industry is among the most highly regulated sectors in the United States. The Institute of Makers of Explosives (IME) recognizes the critical importance of regulation when working with such powerful materials. IME supports common-sense regulations that are rooted in sound science, data, and that reflect our industry’s best practices.

Safety regulations have been central to IME’s mission since its founding over a century ago. Since then, IME has developed and published comprehensive safety standards through its Safety Library Publications (SLPs), which provide best practices for the manufacture, storage, transportation, distribution and use of commercial explosives. These 19 publications have been widely adopted and incorporated into numerous federal, state, and local regulations. Since 1960, IME’s SLPs have been cited in federal regulations 42 times.

Background

It has been more than two decades since the last comprehensive review of ATF’s regulations for commercial explosives. As a result, current rules and definitions are increasingly misaligned with modern industry practices and today’s business environment. Some regulations have become unnecessarily burdensome without providing meaningful improvements to safety or security.

The Role of the ATF

The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) serves as the primary federal regulator of the commercial explosives industry. IME has worked collaboratively with ATF to propose regulatory updates and has found a cooperative partner in the agency.

IME’s top three regulatory modernization priorities include:

1. Timely background checks and clearances for workers
2. Modernization of recordkeeping requirements
3. Adoption of the IME Safety Analysis for Risk (IMESAFR)

1. Timely Background Checks and Clearances

All personnel who handle commercial explosives must undergo ATF background checks. In some cases, these checks can take up to six months, disrupting operations in an already tight labor market.

IME Recommends:

• Expediting background checks through the FBI’s National Instant Criminal Background Check System (NICS)
• Making background clearance records transferable between employers
• Creating a timely appeal or relief process for long-standing employees flagged during renewal of their Federal Explosives License/Permit (FEL/FEP)
• Allowing subcontractors, temporary workers, and interns to be vetted as an Employee Possessor under a company’s federal explosives license

2. Modernize Recordkeeping Requirements

Accurate inventory tracking is vital for ensuring the safety and security of commercial explosives. However, current regulations need modernization to support more efficient recordkeeping.

IME Recommends:

• Update regulations to formally allow electronic recordkeeping, which ATF currently permits only on a case-by-case basis
• Permit a unified set of records for companies, rather than requiring separate records for import, export, distribution, and use—improving both efficiency and security

3. Adopt IMESAFR as a Risk Management Tool

The American Table of Distances (ATD) - originally developed by IME more than a century ago - provides safety guidelines for storing commercial explosives. With advancements in explosives and industry practices, IME developed the IME Safety Analysis for Risk (IMESAFR) in partnership with APT Research in 2004. This quantitative risk assessment tool models potential hazards to workers and the public from explosive facilities and operations.

IME Recommends:

• ATF should formally adopt IMESAFR as a recognized tool for businesses to assess and mitigate risk while enhancing public and workforce safety.

IME’s Asks for Congress:

• Provide dedicated funding to complete the development of electronic forms (e-forms) for the Federal Explosives License/Permit (FEL/FEP), Responsible Person Questionnaire (RPQ), and Employee Possessor Questionnaire (EPQ). Transitioning to e-forms will reduce processing times, reduce government costs, and provide greater certainty for both employees and employers. Increased certainly will lead to better outcomes for not only the commercial explosives industry but the sectors it supports including the mining/quarrying, construction/infrastructure and energy sectors.
• Encourage ATF to modernize its regulatory framework - specifically the Orange Book - to reflect today’s technology and business practices, improving both compliance and administrative efficiency.