The aluminium tides turned for the People’s Republic of China in July, as the nation became a net importer of aluminium for the first time in almost 11 years.
According to customs data released earlier in the week, the Middle Kingdom witnessed aluminium import levels jump by over seven times the volume reported the year prior, totaling 391,297 metric tons. July’s total was the second-highest on record, falling short of April 2009’s total imports of aluminium of 440 thousand metric tons.
Last month’s total eclipsed last July’s imported aluminium by 570 percent. It also bested June’s total aluminium imports of 288,783 metric tons by 35.5 percent. Imports superseded the Middle Kingdom’s total exports last month of 373,402.3 metric tons, making the country a net importer of aluminium for the first time since September 2009.
According to experts, the reversal in the flow of aluminium is the result of a price arbitrage that made importing the raw metal more affordable than buying from domestic producers. Although prices have since risen at the London Metal Exchange, contracts signed while aluminium prices were low will continue to be arriving at Chinese ports, per Wan Ling of CRU.
The People’s Republic of China has been the world’s most prolific producer of aluminium for the past several years. However, the country has faced a great deal of criticism due to its overseas sales at prices that often undercut the local aluminium sector. As a result, China has faced a great deal of criticism and push back from countries around the world.