Aluminum Industry Supports USTR Action on China
By Metal Center News Staff
on Jan 18, 2017
Domestic aluminum industry officials expressed satisfaction with the decision by the United States Trade Representative to seek trade action against China over subsidy concerns. The USTR is asking the WTO to investigate whether certain producers of primary aluminum are causing “serious prejudice” to U.S. interests by artificially expanding Chinese capacity, production and market share.
The United Steelworkers claim China’s aluminum production growth has increased its capacity by 22 million tons, or 130 percent, in the last eight years. The result has been a decline of more than 35 percent in world aluminum prices over that period.
"As a result, U.S. producers cannot get fair market prices for their products. This has led to significant injury, with numerous facilities closing and more than 6,600 highly skilled USW members laid off,” says Leo Gerard, president of the USW. In 2008, 14 smelters were operating in the United States. Today, there are only five.
“China’s subsidies have had and are continuing to have a significant adverse impact on the U.S. domestic aluminum industry, and ultimately are harmful to American jobs, workers and business,” says Matt McMahon, chairman of the Aluminum Extruders Council, Wauconda, Ill. “The USTR’s action is an important first step towards addressing, and correcting, China’s policies on aluminum.”
The Aluminum Extruders Council has been a leader in seeking to level the competitive playing field for aluminum extruders, and aluminum in general, through its calls for countervailing duties on Chinese imports. “We have continued to witness inexplicable marketplace behavior by Chinese aluminum extruders despite our industry’s best efforts to have the U.S. impose duties,” McMahon says.
Heidi Brock, president and CEO of the Aluminum Association, said her organization will review the request by the USTR to assess its impact across the full value chain. “We continue to believe that a negotiated agreement between the U.S. and Chinese governments is needed to address the fundamental issue of aluminum overcapacity in China. Overcapacity is damaging to all segments of the domestic aluminum industry—upstream, midstream and downstream—and it is critical to assess the potential impact of any trade action on all aluminum producers.