The Aluminum Association, which represents producers and suppliers to the North American aluminum industry, expressed strong concern today about a recent call for the removal of a long-standing 15% tax on primary aluminum exported from China.
The call came from the Chinese Non-Ferrous Metals Industry Association and “appealed to all relevant national authorities to eliminate as soon as possible the provisional export tariff on aluminum to achieve integration of domestic and international aluminum markets.”
The Chinese government, which relies heavily on imported bauxite, has long applied export taxes on primary aluminum as part of a broader strategy to discourage exports of energy-intensive products and emphasize sustainable, quality growth. The unilateral removal of these taxes could have unforeseen impacts on the balance of trade and the global aluminum market.
In the US, domestic primary aluminum production is an essential element to American manufacturing. According to an economic analysis by John Dunham & Associates, this segment of the industry is responsible for a minimum of 10,600 jobs and $6 billion in economic output. The domestic aluminum industry could come under additional pressure should China remove the export taxes on primary aluminum.
“We strongly encourage the Chinese government to consider both the impact on the global aluminum market as well as the impact on their country’s own sustainability goals before heeding any call to remove export taxes on primary aluminum,” said Aluminum Association President & CEO Heidi Brock. “During a time when China is making global commitments to reduce greenhouse gas emissions, it would be a serious mistake to change course on this long-standing policy.”
According to Aluminum Association data, from 2012 through 2014, US imports of semi-fabricated aluminum products (semis) from China increased 115%, growing China’s share from roughly 14% to nearly 28% over that period. Imports of Chinese semis totaled 675 million pounds year-to-date, an increase of 75% over the same period in 2014.