Aluminium scrap exports by US up 13% through April; to be affected by China’s scrap tariffs in Q2 2018

According to the latest Mineral Industry Survey report from US Geological Survey, US domestic primary aluminium production in April 2018 was 71,000 tonnes. The average daily production in April was 2,360 tonnes, 3% more than that in March 2018, 18% more than that in April 2017, and 13% more than that in April 2016. Recovery of secondary aluminium from imported and domestically procured scraps contributes a significant portion of aluminium consumed in the US.

The U.S. continued to import its crude, semi-finished aluminium and scrap from its key supplying countries to accommodate the domestic consumption.  The country imported 60,700 tonnes of aluminium scrap in April, accounting for about 11% of the total import. For the period of January to April 2018, 221,000 tonnes of scrap were imported by the U.S., about 9.2% of the total import.  The scrap import volume for April and also the YTD volume remain flat from 2017.

Total aluminium recovered from scrap in April 2018 was 300,000 tonnes, slightly less than the amounts in March 2018 and April 2017, but slightly more than that in April 2016. Of this, 170,000 tonnes of aluminium was recovered from new scrap and 130,000 tonnes was recovered from old scrap. The maximum scrap was procured domestically. 

On the other hand, the U.S. exported 149,000 tonnes of aluminium scrap in April, accounting for about 55.5% of the total export. For the period of January to April 2018, about 536,000 tonnes of scrap were exported by the U.S., about 54% of the total export.  Aluminium scrap export has increased about 23% YoY in April and about 13% YTD.

The scrap export to China in the period from January to April stood at 238,000 tonnes, slightly down from about 253,000 tonnes exported in the same period of 2017. In the month of April 2018, the amount stood at 60,100 tonnes compared to 62,100 tonnes in April 2017.

On March 8, the President of the United States imposed a 10% tariff on aluminium imports under authority of Section 232 of the Trade Expansion Act of 1962. China afflicted a serious blow on the US aluminium scrap industry by officially slapping a 25% retaliatory tariff on scrap aluminium from the U.S., effective Monday April 2.  The temporary exemption from the 10% tariff on aluminium imported from Canada, Mexico, and member countries of the EU expired June 1 without being extended.

These new trade measures will have a serious impact in the export and import of aluminium scrap by the U.S. in the second quarter of 2018.