Primary weekly: EU considers implementing complementary tariffs on Chinese exports including aluminium

The primary aluminium sector has seen incredible activities this week, with the EU considering imposing surcharges on some imported products, which has caused concern from China. The EU's Carbon Border Adjustment Mechanism aims to protect European firms against cheap imports that do not follow environmental norms. However, this has raised problems, particularly in China, as it may result in price increases for China's major exports to the EU. China is advocating for collective discussions and international cooperation in accordance with WTO standards to address the issues posed by climate change. European industrial aluminium clients are facing a delay in supplying smelters for new contracts in 2024. The delay is caused by concerns about exceeding purchase requirements, as the demand for finished metal goods has decreased. Suppliers and customers are engaged in securing supply agreements during the market's "mating season" because aluminium is used in transportation, building, and packaging.

During the Inner Mongolia non-ferrous metal energy saving and carbon reduction technology exchange meeting on September 16, Zhang Guangsheng, the deputy director of the Industry and Information Department of the autonomous region, shared that the region's non-ferrous metal output had increased by 4.7 per cent year on year in the first seven months of this year, reaching 4.792 million tonnes and securing a second-place ranking in the country.

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Alcoa Corp., the largest producer of aluminium in the United States, has announced the appointment of Andrew Hastings, the former general counsel of Canada's Lundin Mining Corp., as its new Chief Legal Officer.

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NALCO's profit margins have faced challenges attributable to increased input costs, the volatility of the business environment, and fluctuations in global demand and supply, as indicated by a company official. National Aluminium Company Ltd (NALCO) reported sales amounting to 14,171 crore INR and a net profit of 1,544 crore INR for the fiscal year 2022-23.

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On Friday, September 22, A00 aluminium ingot price in China gained RMB 90 per tonne to close at RMB 19,740 per tonne, with the average prices between RMB 19,720 per tonne and RMB 19,760 per tonne. The spot contract price is expected to be traded at a premium price of RMB 210 per tonne to RMB 250 per tonne.

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On September 21, the LME aluminium live price chart experienced decreasing aluminium rates, with the LME aluminium cash bid price and the LME aluminium official price slumping by US$35 per tonne or 1.59 per cent and US$35.50 per tonne or 1.61 per cent to officially close at US$2,166 per tonne and US$2,166.50 per tonne.

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The European Union (EU) is considering levying surcharges on some imported products such as steel and cement. However, the People's Republic of China, a significant trading partner, has expressed concerns and wants the EU to double-check with World trading Organisation (WTO) global trade norms. According to experts, this might result in price increases for China's major exports to the EU, such as aluminium and steel.

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According to regulatory filings, Glencore acquired just a fraction of the potential 6.9 million tonnes of aluminium it could purchase between 2020 and 2022 through its agreement with Russian aluminium giant Rusal. However, this contract may also be extended until 2025.

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According to Chinese customs data released on September 18, 2023, the country experienced a significant increase of 38.9 per cent in aluminium imports in August compared to the same period the previous year. This surge can be attributed to increased purchasing due to low domestic aluminium stocks and improved prospects for demand.

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European industrial aluminium clients are now experiencing a delay in supplying smelters with the required quantities for new contracts in 2024. This delay is mainly caused by concerns that they may exceed their purchase requirements, as the area's demand for finished metal goods has decreased significantly in recent years.

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