Exclusions Of Imported Aluminium Can Sheet Hurts China’s Battle Against Oversupply: Aluminum Association

Exclusions Of Imported Aluminium Can Sheet Hurts China’s Battle Against Oversupply: Aluminum Association

The Aluminum Association voiced its opposition late last week to exclusion requests under Section 301 for aluminium can sheet originating from the People’s Republic of China, reasoning that such requests will work against the Middle Kingdom’s oversupply problems.

In its weekly report, the Association followed up a Letter of Objection to the Office of U.S. Trade Representative about two such requests by saying that such exclusions “would undercut broader efforts by the [Trump] administration to address unfair market practices in that country including persistent, state-subsidized overcapacity.”

The Aluminum Association’s Vice President of Policy & International Trade Lauren Wilk said in the report that standing firm on Section 301 duties are a key component for encouraging China to cut its significant structural overcapacity that has distorted the entirety of the global aluminium value chain.

“We strongly believe that broad exclusions from tariffs on imports of aluminum and aluminum products from China significantly diminish the incentives for the government of China to take action to address the massive overcapacity in its aluminum industry.”

Wilk went on to say that such broad product exclusions only serve to encourage Chinese aluminium producers to shift production to those excluded products, thereby doing nothing but redirecting overcapacity into a different area.

“Because China’s slowing economy cannot absorb all of the metal it produces domestically, more and more of its semi-fabricated and downstream production is being exported to global markets,” she explained.

The Aluminum Association continued by noting that U.S. producers provided almost 95 percent of the domestic aluminium can sheet market last year, and that other non-Chinese sources stood ready to fill any new demand that may arise in the near future.

The U.S. government imposed the Section 301 tariffs on certain aluminium and steel imports during the summer of 2018. However, aluminium can and sheet products were not included in antidumping and countervailing duty orders issued by the Department of Commerce early this year.