Aluminum Association report shows aluminium foil imports from China down & U.S. investment up after AD/CVD duties

Aluminum Association released a new white paper, Targeted Trade Enforcement in Action: Aluminum Foil AD/CVD One-Year Later yesterday. The paper highlights the progress made after the Commerce Department’s final application of antidumping (AD) and countervailing duty (CVD) orders on imports of certain aluminium foil from China on April 19, 2018.

The report shows the import of Chinese aluminium foil registered about two-thirds drop after the duties and the US saw an investment of US$169 million in the segment.   

“One year after taking strong action to enforce our nation’s trade laws, we are seeing clear and significant progress in the U.S. aluminium foil market,” said Heidi Brock, president & CEO of the Aluminum Association.

The AD and CVD orders ranged from 55 to 176 per cent, reflecting the unfair trade practices by Chinese aluminium foil producers and exporters.  The CVD white paper highlights a number of key developments in the market after the trade orders came into effect:    

•         Aluminium foil imports from China fell by 64 per cent between 2017 and 2018

•       Aluminium exports from China surged 21 per cent to the rest of the world in 2018

•       U.S. shipments of aluminium foil increased 1.6 per cent to 439,803 tonnes in 2018

 The report highlights how a targeted approach to trade reforms and barriers can have a positive impact on U.S. manufacturers.  A study by the Organization for Economic Cooperation and Development (OECD) documented US$70 billion of subsidy offered by the Chinese government over the past 5 years. 85 per cent of the government support cited in the study went to five aluminium-producing firms in China. The Aluminum Association supported such targeted trade action to address Chinese overcapacity in the global level.

“Not all tariffs are created equal,” added Brock. “Targeted trade enforcement as we’ve seen successfully deployed in the aluminum foil and, more recently, common alloy sheet, markets are the best way to make an impact. This approach allows us to effectively address issues in the marketplace while avoiding needless and disruptive tariffs on vital trading partners who play by the rules.”

The Trump administration has a historic opportunity to address structural aluminum overcapacity in China as part of ongoing trade negotiations. The Aluminum Association is encouraging the administration to “prioritize the pervasive subsidies and other policies that fuel China’s structural overcapacity across the aluminum value chain as part of the ongoing bilateral negotiations.”

She urged the administration to focus on Chinese subsidies and other policies that fuel China’s structural overcapacity which has impacted the entire aluminium value chain as part of the ongoing trade negotiations.  The association is now lobbying for removal of Section 232 tariffs as part of final implementation of the U.S-Mexico-Canada Agreement.