Archive | Aluminium/Bauxite

Commentary: China may end up inadvertent winner from Trump’s aluminium tariffs – by Clyde Russell (Reuters U.K. – August 13, 2018)

LAUNCESTON, Australia (Reuters) – It’s probably not what U.S. President Donald Trump had in mind when imposing tariffs on aluminium imports, but it looks likely that some of the big winners from the 10 percent import tax will be China’s producers.

While Chinese aluminium companies now face the same tariff obstacle as other exporters to the United States, they appear better placed to benefit from some of the (most likely) unintended consequences of the Trump administration’s policies.

The Trump tariffs and measures against major Russian producer Rusal, along with a strike at Alcoa’s alumina and bauxite operations in Western Australia are combining to roil aluminium markets. Continue Reading →

Ford Calls Rising Steel, Aluminum Prices ‘Significant Headwind’ – by Keith Naughton (Bloomberg News – August 8, 2018)

Rising steel and aluminum prices, driven up by President Donald Trump’s tariffs on those commodities, are a substantial drag on Ford Motor Co.’s business, though a top executive said the company doesn’t plan to pass higher costs on to consumers.

“The escalation of steel and aluminum prices is really significant,” Jim Farley, Ford’s president of global markets, said after a factory ceremony near Detroit to commemorate building the 10 millionth Mustang muscle car. “It’s a significant headwind for us. It’s something that puts pressure on our own costs.”

Ford began the year by warning that rising costs for raw materials like steel and aluminum, coupled with unfavorable exchange rates, would add $1.6 billion to its costs this year. Continue Reading →

Soup, pop and beer companies to increase prices to combat aluminum tariffs – by Tara Deschamps (Canadian Press/Toronto Star – August 7, 2018)

Soup, pop and beer makers can’t seem to put a lid on the effects of the recent aluminum tariffs. The 10 per cent fees that were slapped on imports of the metal by U.S. President Donald Trump in early July are making cans more expensive and forcing food and beverage companies that rely on them for packaging to consider price increases and other ways to offset the costs.

The Campbell Company of Canada, which produces canned soup at its soon-to-close Etobicoke plant, is set to jack up prices in late August on a “broad range of products.”

The exact amount by which prices will be increased is still under consideration, but the tariffs combined with raising freight, packaging and ingredient costs are to blame, company spokesperson Alexandra Sockett told The Canadian Press in an email. Continue Reading →

Canadian craft brewers scramble for aluminum cans – by Marcy Nicholson (Reuters U.S. – July 31, 2018)

CALGARY (Reuters) – Canadian microbreweries are facing a shortage of cans and higher costs, forcing some to cut beer production after the country imposed retaliatory import duties on U.S. aluminum imports in the busy summer season.

Though Canada is the world’s third biggest aluminum producer and cans are made in the country, beer makers also rely on the import of more than 2 billion cans annually, largely from the United States, Statistics Canada data shows.

So when Canada struck back at the United States’ tariffs on aluminum imports on July 1, and included cans, some craft brewers received notices of higher prices due to the duties while others have been unable to secure their usual supply of aluminum cans. Continue Reading →

Rio’s $7 Billion Windfall Points to Mining’s Lesson Learned – by Thomas Biesheuvel, David Stringer and Martin Ritchie (Bloomberg News – August 1, 2018)

Rio Tinto Group’s $7 billion pledge to shareholders is the latest sign the world’s biggest miners are resisting the temptation to backslide.

The mining industry has undergone a dramatic makeover since the end of the last commodity boom. Investors and management remain wary of pricey deals after much of the sector got burned by overpaying for assets and few among the largest producers see the need for major new supply growth.

Rio is generating massive amounts of cash even as cost pressures rise, and its low debt levels mean the No. 2 miner has financial capacity to move on acquisitions or projects. For now, it’s holding fire. Continue Reading →

Commentary: A turbulent year for alumina market could get still worse – by Andy Home (Reuters U.K. – July 31, 2018)

LONDON (Reuters) – Alumina is having a turbulent year. The intermediate product sitting between bauxite and refined metal on the aluminium production chain doesn’t normally grab the headlines.

But it did in April, when the spot price doubled to over $700 per tonne as the market reacted to U.S. sanctions on Oleg Deripaska and his Rusal empire.

The sanctions threw into doubt the future of Rusal’s Aughinish alumina plant in Ireland, threatening a second blow to global production after the part closure of the Alunorte refinery in Brazil. Continue Reading →

Trump’s aluminum tariffs are unlikely to produce a major smelter revival, experts say – by Daniel Dale (Toronto Star – July 28, 2018)

WASHINGTON—Three weeks after President Donald Trump proclaimed that America’s aluminum businesses were booming, “through the roof,” because of his tariffs, America’s largest aluminum producer made its quarterly earnings announcement.

Alcoa said it was still earning billions. But it also said it was lowering its profit forecast. Part of the reason: the tariffs, which it expected to cost $14 million (U.S.) a month. The company operates three smelters in Canada, which Trump declined to exempt.

Alcoa’s complaint highlighted the scant corporate support for the 10 per cent tariffs. Unlike Trump’s 25 per cent steel tariffs, which were endorsed by U.S. steelmakers, the industry group for the American aluminum industry is opposed to the aluminum tariffs. Continue Reading →

Commentary: Smelter hits halt global aluminium production growth – by Andy Home (Reuters U.K. – July 25, 2018)

LONDON (Reuters) – Global aluminium production growth ground to a standstill in the first half of this year. The world’s smelters produced 31.76 million tonnes of metal in January-June, a 1 percent decline on the first half of 2017, according to the International Aluminium Institute (IAI).

Expressed in annualised terms, global output in June was almost two million tonnes lower than a year earlier. Production outside of China has been creeping higher since January but the growth rate is being constrained by an unusually high level of disruption with multiple plants operating at reduced rates.

National run rates in China, the world’s largest single producer, have also been recovering from last year’s combination of “illegal” capacity closures and winter heating season restrictions but are still down on year-earlier levels. Continue Reading →

Chinese aluminum foil maker sues U.S. over anti-dumping duties – by Tom Daly (Reuters U.S. – July 23, 2018)

BEIJING (Reuters) – Chinese aluminum foil producer Shantou Wanshun Package Material Stock Co on Monday said its subsidiary is suing the United States over twin anti-dumping and anti-subsidy duties Washington imposed on its shipments.

In a statement to the Shenzhen Stock Exchange, Wanshun said Jiangsu Zhongji Lamination Materials, which was hit with a countervailing duty of 17.14 percent and an anti-dumping duty of 37.99 percent earlier this year, had filed a lawsuit with the U.S. Court of International Trade.

Zhongji was among the Chinese foil companies that unsuccessfully filed a joint “no injury” claim with the U.S. International Trade Commission last year as Washington probed whether the companies were unfairly subsidised, and is now trying to reverse the duties on its own. Continue Reading →

Miners test greener ways to dig – by Rhiannon Hoyle (Wall Street Journal/Toronto Star – July 16, 2018)

Miners are considering new ways to make the dirt they dig up green.

Across the U.S. border in Quebec, a research facility will fine-tune a technology that its owners—Alcoa Corp. and Rio Tinto PLC—believe could turn aluminum smelters carbon-free for the first time. Another initiative under way in Sweden could see hydrogen replace coking coal in manufacturing steel.

Miners have long seen investing in technology as a way to bring costs down and protect profits during swings in the global economy. But a new force for change has recently emerged: customers such as Apple Inc. and Audi AG that see a marketing advantage in ensuring their products are cleaner and greener than before.

Nestlé SA’s coffee brand Nespresso, for example, wants to source all the aluminum for its capsules from sustainably managed operations by 2020, which includes strict limits on greenhouse-gas emissions. Continue Reading →

COLUMN-Pain for aluminium shorts as LME gets squeezed again – by Andy Home (Reuters U.K. – July 13, 2018)

LONDON, July 13 (Reuters) – Aluminium hasn’t escaped the broader industrial metals rout. The London Metal Exchange (LME) aluminium price has on Friday morning touched $2,021.50 per tonne, its lowest level since April.

The “Russian Premium”, which resulted from the April 6 imposition of U.S. sanctions on Oleg Deripaska and his Russian aluminium empire Rusal, has been fully unwound.

The market is expecting sanctions to be lifted but aluminium’s slide is also part of a broader metals retreat as macro concerns trump micro narratives. That LME price, however, is for metal in three months time, a quirk of the London market that sets the global price benchmark. Continue Reading →

COLUMN-Beer versus aluminium; the U.S. battle-lines are drawn again – by Andy Home (Reuters U.K. – July 9, 2018)

LONDON, July 9 (Reuters) – The price of aluminium paid by consumers in the United States has risen sharply this year. This is not entirely surprising, given the imposition from the start of March of a 10-percent tariff on just about all imports of the metal.

But has the price risen too much? The Beer Institute, which represents the country’s more than 5,000 brewers, thinks so.

It has asked the Department of Justice and the Federal Trade Commission to “address potentially anticompetitive activities in the aluminum market that are driving up aluminum prices”. Thirty-two U.S. lawmakers think so as well. Continue Reading →

Trump’s Trade War Looms Over a Canadian Town Built to Supply America – by Danielle Bochove (Bloomberg News – June 28, 2018)

Arvida, Quebec, is part of a cross-border ecosystem responsible for the metal in three out of four American cars.

If ever a town embodied U.S.-Canadian symbiosis, it’s Arvida, Quebec. Built by Americans, its giant smelter supplied most of the Allied forces’ aluminum in World War II and today makes metal used in Budweiser beer cans, Tesla and Ford cars and in AR15 rifles, part of the 2.5 million metric tons that Canada sends over the border each year.

But now this corner of French-speaking Canada is in America’s cross hairs after the Trump administration’s shock move to tax metal from its closest ally under the pretext of national security.

“When you want to kill your dog, you will say he has rabies,” Mayor Josee Neron said in an interview. “To see one person destroy all that in just a blink of an eye, I think it’s too bad.” Continue Reading →

Time for Trudeau to cut the outrage over Trump’s antics and just cut a deal – by Diane Francis (Financial Post – June 19, 2018)

Imagine throwing a $600-million party and one of the guests leaves in a huff and then Twitter-trashes you all across the Pacific Ocean.

That’s what happened to Prime Minister Justin Trudeau after he hosted the recent G7 extravaganza and was subsequently attacked by U.S. President Donald Trump.

But this isn’t the first of Trudeau’s trade missteps. He went to China and got the cold shoulder from Xi Jinping for a free trade deal, after snubbing Japan and its Trans-Pacific Partnership by missing a signing ceremony. Continue Reading →

Hidden aluminum stocks to be lured out by premiums, charges – by Eric Onstad (Reuters U.S. – June 12, 2018)

LONDON (Reuters) – High U.S. aluminum premiums and weaker returns from storage financing deals are likely to lure more metal onto the market from hidden inventories. The bulk of more than 10 million tonnes of global stocks of the metal, mainly used for transport and construction, are outside warehouses certified by exchanges, analysts estimate.

The additional material flowing from these unregulated storage areas could help to fill a gap and supply industrial consumers if U.S. sanctions on Russia’s Rusal remain.

An influx of material, however, could weigh on the market if the United States lifts restrictions on United Company Rusal, the biggest aluminum producer outside of China. Continue Reading →