Canada’s aluminium scrap exports to US surge by nearly 300% Q-o-Q in Q2 2020, but both the countries drop their tariff plans

According to the latest data shown by the US Geological Survey, Canada exported 157,000 tonnes of aluminium scrap to the United States in the first half of 2020 compared to 190,000 tonnes during the same period last year. This means Canada’s aluminium scrap exports to the US dwindled by 17.37 per cent year-on-year in H1 2020.

In the second quarter of the year, Canada exported 67,400 tonnes of aluminium scrap to the US in comparison to only 17,000 tonnes in the first quarter. Exports surged in the second quarter due to the hit on domestic demand by the COVID-19 pandemic, while the production across Canadian smelters remained stable.

Hike in exports led to the US government’s decision to re-impose the additional 10 per cent tariffs on Canadian aluminium imports in mid-August 2020. Trump accused Canada of flooding the US market with its raw, unprocessed aluminium. But opposing the allegation, the Aluminum Association of Canada argued that the jump in Canadian aluminium shipments to the US was within historical norms and reflected stepped-up production from a Canadian smelter that had been shut by a labour dispute.

In June 2020, Canada exported 30,600 tonnes of aluminium scrap to the US, up by 54.5 per cent month-on-month but down by 2.24 per cent over the year. In May, Canada’s exports to the US were 19,800 tonnes, inching up by 16.47 per cent from 17,000 tonnes in April. The exports in April also saw a sharp jump month-on-month from 5,490 tonnes in March.

However, the Trump Government, on September 15, stepped back from its decision of re-applying the 10 per cent tariff on Canadian aluminium, following the rise of retaliation from Ottawa. Canada’s multibillion-dollar counter-tariffs on American aluminium products were scheduled to go into effect on September 16.

Canada also dropped its threat to levy retaliatory sanctions on the US aluminium products soon after the Trump administration declared its decision. Right from Canada’s political leaders to aluminium manufacturers welcomed the decision of the US.

“Very good news for the Quebec’s aluminum producers,” tweeted Pierre Fitzgibbon, the province’s economic development minister.

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