China Hikes Export Tax on Aluminium
Strategic Research Institute
Published on :
7 Feb, 2023, 5:03 am
Reuters has reported that China has raised export tariffs on unwrought primary aluminium and alloy at the start of this year after a rare burst of export activity in the first part of 2022. The tariff increases fit with China's long-standing policy of encouraging exports of value-add aluminium products rather than raw metal.
The country, which was a huge importer of unwrought aluminium in both 2020 and 2021, briefly emerged as supplier of last resort, particularly to Europe, where multiple smelters curtailed operations due to high power prices.
The trigger for this highly unusual trade activity was a near doubling in the premium for physical metal in Europe, where smelter closures widened an existing regional supply gap. The premium for duty-unpaid aluminium jumped from USD 258 per tonne over London Metal Exchange cash in January to USD 505 in June. China shipped 188,000 tonnes of primary metal to the Netherlands in the first half of 2022. It also dispatched 33,000 tonnes to Turkey, 20,000 tonnes to Montenegro and 5,000 tonnes to Italy.