Despite Lobbying, India Government Passes On Rise In Aluminium Scrap Duties

Despite Lobbying, India Government Passes On Rise In Aluminium Scrap Duties

Although the Indian Primary Aluminum Association has intensely lobbied the Indian government for a raise on scrap metal imports, New Delhi’s budget for the upcoming year has no provisions for an increase on aluminium-rich zorba scrap metal import duties.

Indian aluminium firms stepped up calls for a rise in aluminium scrap import duties after the People’s Republic of China announced its intentions to draw down imports of the same by next year. With the Chinese market closing as a destination for primarily U.S.-based scrap exporters, the focus shifted to secondary smelters on the Indian subcontinent.

As a result of significant increases in imports, prices for 95/2 zorba have fallen just as profoundly, exacerbating automotive industry woes and weak demand for ADC12 alloy. As of last week, prices for 95/2 zorba dropped to a six-month low of 40-42¢/lb. However, American scrap exporters say a rise in import tariffs would only worsen an already untenable situation.

Meanwhile, import tariffs for aluminium remelt scrap ingot and aluminium dross have been “omitted” from the budget, leaving buyers and sellers in a state of confusion over next year’s plans.

“We have asked for further clarification, because many people have their own import licenses that are valid through the end of the year,” said an exporter who spoke with domestic media.

“Whatever [scrap] is already on the water, we’ll have to see, but for new orders [of omitted scrap grade], I am just holding off. We hope to resolve and get the final clarification sooner than later.”

The consensus view seems to be that such wording does not signal a ban on such imports, but it may leave open the door to future volume restrictions or elevated duties.