The US government announced that since May 10, 2019, the tariff rate of 200 billion US dollars of imported goods imported from China has increased from 10% to 25%, resulting in a further escalation of Sino-US trade friction. On May 13, China responded to tariffs of 25%, 20%, 10% and 5% on US$60 billion from the US. These commodities will be implemented on June 1.
Antaike analysts believe that China's passive measures to impose tariffs on 60 billion US dollars of goods will not have a substantial impact on the aluminum industry and the market ; however, the United States imposes tariffs on China's $200 billion in exports, subjecting it to trade sanctions. The scope of aluminum and related products is further expanded, and the indirect effects cannot be ignored.
In 2018, China imported aluminum ingots, alumina, unwrought aluminum and aluminum alloys, aluminum scrap, aluminum and aluminum products and other aluminum-related commodities of 11.35 billion US dollars , of which US imports were 1.26 billion US dollars, accounting for 11.1%. The export value of the above-mentioned aluminum-related commodities was US$27.83 billion, of which US$3.22 billion was exported to the United States, accounting for 11.6%. It is necessary to analyze the impact of Sino-US tariffs on China's aluminum industry and market from import and export.
On the import side, China imposes tariffs on US goods, mainly affecting aluminum and scrap aluminum . Of the $60 billion in China's list of commodities, there are 55 aluminum-related taxes, mainly focused on aluminum and its products in Chapter 76 of the HS Code. There are 51 taxes covering 96 chapters and 96% of goods. Among them, the increase of 25% tariff involves 25 taxes, involving 75.089 million US dollars imported from the United States, accounting for 3.0% of China's global imports in 2018; increasing 20% tariffs involves 9 taxes, involving imports of US$5.79.99 million from the United States , accounting for 7.7% of China's total imports in 2018; 10% tariffs involving 21 taxes, involving imports from the United States of 311.11 million US dollars, accounting for 24.5% of China's total imports in 2018; involving aluminum products. The 55 taxes related to China totaled 440 million US dollars worth of goods imported from the United States, accounting for 9.9% of China's total imports of such goods, accounting for 35.2% of the total US imports of aluminum goods. From the analysis of commodity types, it mainly involves 32,995 tons of aluminum (HS code 7603-7608), including high value-added aluminum slabs and pipes; aluminum products (HS code 7609-7616) 2,334 tons. After the increase of tariffs, the cost of China's imports of related products from the United States will increase to varying degrees. In a short period of time, there may be shortages or delays in supply of high-end aluminum and aluminum products that rely on imports. However, after a period of transition, China can eliminate the impact through domestic production or the search for import substitution countries. Therefore, China’s tariffs on the United States will not have a major impact on China’s imports of aluminum and products. In addition, China’s counter-action against the United States in 2018 imposed a 25% tariff on imported aluminum scrap from the United States. Therefore, compared with 2017, China's imports of scrap aluminum from the United States fell by 16.9% in 2018; major changes have also taken place. Since October 2018, the general trade import of scrap aluminum has completely stopped, all of which are imported processing trade. The resulting waste aluminum supply gap is filled by domestic recycling of scrap aluminum and primary aluminum and has already digested the impact. Therefore, China’s tariffs on the United States will not have a major impact on China’s imports of aluminum and products. In addition, China’s counter-action against the United States in 2018 imposed a 25% tariff on imported aluminum scrap from the United States. Therefore, compared with 2017, China's imports of scrap aluminum from the United States fell by 16.9% in 2018; major changes have also taken place.Since October 2018, the general trade import of scrap aluminum has completely stopped, all of which are imported processing trade. The resulting waste aluminum supply gap is filled by domestic recycling of scrap aluminum and primary aluminum and has already digested the impact. Therefore, China’s tariffs on the United States will not have a major impact on China’s imports of aluminum and products. In addition, China’s counter-action against the United States in 2018 imposed a 25% tariff on imported aluminum scrap from the United States. Therefore, compared with 2017, China's imports of scrap aluminum from the United States fell by 16.9% in 2018; major changes have also taken place. Since October 2018, the general trade import of scrap aluminum has completely stopped, all of which are imported processing trade. The resulting waste aluminum supply gap is filled by domestic recycling of scrap aluminum and primary aluminum and has already digested the impact. In addition, China’s counter-action against the United States in 2018 imposed a 25% tariff on imported aluminum scrap from the United States.Therefore, compared with 2017, China's imports of scrap aluminum from the United States fell by 16.9% in 2018; major changes have also taken place. Since October 2018, the general trade import of scrap aluminum has completely stopped, all of which are imported processing trade. The resulting waste aluminum supply gap is filled by domestic recycling of scrap aluminum and primary aluminum and has already digested the impact. In addition, China’s counter-action against the United States in 2018 imposed a 25% tariff on imported aluminum scrap from the United States. Therefore, compared with 2017, China's imports of scrap aluminum from the United States fell by 16.9% in 2018; major changes have also taken place. Since October 2018, the general trade import of scrap aluminum has completely stopped, all of which are imported processing trade. The resulting waste aluminum supply gap is filled by domestic recycling of scrap aluminum and primary aluminum and has already digested the impact. Significant changes have also taken place. Since October 2018, the general trade import of scrap aluminum has completely stopped, all of which are imported processing trade. The resulting waste aluminum supply gap is filled by domestic recycling of scrap aluminum and primary aluminum and has already digested the impact. Significant changes have also taken place. Since October 2018, the general trade import of scrap aluminum has completely stopped, all of which are imported processing trade. The resulting waste aluminum supply gap is filled by domestic recycling of scrap aluminum and primary aluminum and has already digested the impact.
On the export side, the United States increased the import tariff on 200 billion US dollars of goods from 10% to 25%. The impact on the aluminum industry is primarily concentrated on the export of aluminum products and aluminum-containing end products. 200 billion US dollar list includes 23 aluminum, aluminum products and related products. In 2018, China exported 1.32 billion US dollars of such goods to the United States, accounting for 18.0% of China's total exports of such goods. Commodities include: (1) Three types of raw materials such as aluminum hydroxide, aluminum fluoride, and aluminum scrap; (2) only aluminum powder, and aluminum has been used in the United States for aluminum extrusion, sheet and strip, aluminum foil, etc. The three major categories Of aluminum having implemented double-anti-sanctions; (3) most of the aluminum products in Chapter 76 of the HS Code (HS 7609-7616). Among them, except for the large export volume of aluminum products to the United States, the e In 2018, China exported 387,000 tons of aluminum products to the United States, of which the aluminum products involved in the case were 225,000 tons, accounting for 14.2% of the total exports of such goods in China .
Aluminum is a commodity that has been the focus of attention in the US-China trade friction and is also an area subject to intensive sanctions. So far, the United States has implemented double-reaction on China's extruded materials, sheet and strip, and aluminum Foil. It has applied a "232 tariff" on some products, plus 50 billion last year and 200 billion US dollars this time. Import tariffs on goods have increased from 10% to 25%, and China's aluminum, aluminum and some aluminum-containing Part of the import of scrap aluminum, this time has no substantial impact on the import of aluminum and aluminum products Considering imports and exports comprehensively, the impact of Sino-US trade friction on China's aluminum industry is mainly reflected in the deterioration of the export market. After the three major categories of aluminum are blocked In addition, the indirect impact of aluminum and aluminum consumption on the export of parts and equipment is not negligible. For example, the export Of aluminum alloy wheels is estimated to be reduced by at least 50%, or 250,000 tons/year.
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Shirley N.//SMC Editor