China-US Trade Tensions: Chinese aluminum companies diverting exports from US
Updated 12:35, 28-Aug-2018
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02:48
It's been five months since the US slapped tariffs on aluminum imports. To offset the negative effects, Chinese aluminum manufacturers are diverting their exports away from the US to places like Canada, Japan, and Europe. CGTN's Li Jianhua visited one company in central China's Henan Province -- its general manager says export volume is actually increasing.
Ear-blasting aluminium plates in the making. This hot rolling line produces about 530-thousand tons of aluminium products annually. The company's export total reached 200-thousand tons last year with half of that going to the US. But in the wake of US tariffs on Chinese aluminium exports, things are quite different now.
US President Donald Trump went on record in March saying – the US will rebuild its aluminium industry, and will slap a long-lasting ten percent tariff on aluminium. In particular, the tariff on this company is now over 200 percent!
LIU JIE, GENERAL MANAGER HENAN MINGTAI ALUMINUM INDUSTRY "The impact is big. We sent nearly 100-thousand tons of aluminium to the US last year, which was almost half of our total exports. But since March with the high tariffs now in place, our export to the US is zero."
However, figures from the first half of 2018 show the company's exports already reached the 100-thousand ton mark; a 6.6 percent year-on-year increase.
LIU JIE, GENERAL MANAGER HENAN MINGTAI ALUMINUM INDUSTRY "We switched our attention from the US to other regions and countries, including Europe, Australia, South America and South Korea. So far, exports to these places are almost even with our prior totals to the US."
Statistics show China's overall aluminium exports in the first half of this year reached 2.7 million tons, increasing by 12 percent year on year.
PROF. LIU CHUNSHENGCENTRAL UNIVERSITY OF FINANCE AND ECONOMICS "It's because China is not a major aluminium exporter to the US. The rising price of aluminium products in the global market, conversely, gives China's aluminium products more shares, as its price is lower."
Experts also warn that Chinese companies should explore other markets when the damage is not too big.
LI JIANHUAGONGYI, HENAN PROVINCE "Aluminium is the first of several products targeted by the US tariff scheme against China this March. I'm here at one of the many aluminium manufacturing companies in China, and we can see its production is on the rise, as it's diverting its export to Europe. Many companies like this one are seeking to find some new markets, but apparently - as the company says - it's rather difficult. LJH, CGTN, GONGYI, HENAN PROVINCE."