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Aluminium/Bauxite

Of cars and cans: US aluminum and the pandemic – by Sarah Baltic (SP Global – July 7, 2020)

https://www.spglobal.com/en/

The coronavirus pandemic has obliterated global metals demand as one of the main end uses, automotive applications, has seen major disruptions to the supply chain.

The US metals market, in particular, saw the removal of an estimated 33,000 vehicles per day from production as all major auto producers across the country halted operations in response to government mandates and concerns over the welfare of workers.

Because the transportation sector is the largest end user of aluminum, accounting for around 35% of aluminum consumption, it is easy to see why so many market participants expressed concern over the lingering effects coronavirus would have on the health of the industry.

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Why Canada faces fresh U.S. aluminum tariffs – by James McCarten (Globe and Mail – July 6, 2020)

https://www.theglobeandmail.com/

The United States is once again threatening to spark a fresh tariff war with Canada over aluminum exports, despite the debut of a renegotiated North American trade agreement that was supposed to usher in stability in the midst of an international economic crisis.

Precisely why remains a mystery to trade and industry insiders, although it’s likely the result of a convergence of disparate factors: COVID-19, international metals arbitrage, President Donald Trump’s re-election campaign and US$16.3-billion worth of Russian aluminum.

“It doesn’t make sense,” said Jean Simard, president and CEO of the Aluminum Association of Canada, coming as it does with the coming into force of USMCA – the U.S.-Mexico-Canada Agreement, which formally replaced NAFTA this week.

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Politics, pandemics and Russian aluminum: why Canada faces fresh U.S. tariffs (National Post – July 03, 2020)

https://nationalpost.com/

The Canadian Press – WASHINGTON — The United States is once again threatening to spark a fresh tariff war with Canada over aluminum exports, despite the debut of a North American trade agreement that was supposed to usher in stability in the midst of an international economic crisis.

Precisely why remains a mystery to trade and industry insiders, although it’s likely the result of a convergence of disparate factors: COVID-19, international metals arbitrage, President Donald Trump’s re-election campaign and $16.3-billion worth of Russian aluminum.

“It doesn’t make sense,” said Jean Simard, president and CEO of the Aluminum Association of Canada, coming as it does with the coming into force of USMCA — the U.S.-Mexico-Canada Agreement, which formally replaced NAFTA this week.

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U.S. plan to slap tariffs on Canadian aluminum faces a powerful adversary — the beer lobby – by Gabriel Friedman (Financial Post – June 27, 2020)

https://business.financialpost.com/

As the Trump Administration considers reimposing a 10 per cent tariff on Canadian aluminum, it finds itself at odds with a powerful constituency — beer manufacturers.

On Thursday, Jim McGreevy, chief executive of the Washington, D.C.-based Beer Institute, joined by executives from the American Beverage Association, the Can Manufacturers Institute, and the Aluminum Association, expressed their strong opposition to a tariff or even a quota on Canadian aluminum, in a letter to U.S. Trade Representative Robert Lighthizer.

“Constraints on imports of aluminum from our country’s closest ally, whether in the form of a quota or a tariff, will significantly increase the cost of aluminum in this country,” the executives wrote.

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U.S. threatens new tariffs on Canadian aluminum unless metal exports curtailed – by Adrian Morrow (Globe and Mail – June 24, 2020)

https://www.theglobeandmail.com/

Trump administration officials are threatening to reimpose tariffs on Canadian aluminum if Ottawa does not swiftly agree to cut the amount of the metal exported to the U.S., said three industry sources on both sides of the border with knowledge of the confidential discussions.

Deputy U.S. trade representative Jeffrey Gerrish told Canadian Ambassador Kirsten Hillman in a Friday phone call that Canada has until July 1 to agree to export control measures, such as quotas, or Robert Lighthizer, the administration’s trade chief, will recommend that President Donald Trump reimpose tariffs, one of the sources said.

A Canadian government official said Ms. Hillman discussed aluminum and steel exports with top officials in Mr. Lighthizer’s office on Friday.

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Trump considering reinstating tariffs on Canadian aluminum and steel imports – by Adrian Morrow (Globe and Mail – June 19, 2020)

https://www.theglobeandmail.com/

The Trump administration is floating the possibility of reimposing tariffs on Canadian steel and aluminum imports amid lobbying from American producers, and has been in talks with Ottawa.

U.S. Trade Representative Robert Lightizer told congressional hearings Wednesday that rising metals imports are “a problem with Canada that we’re working on.”

“There have been surges on steel and aluminum,” he said. “It’s something that’s of genuine concern.”

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Column: Friend or foe? Canadian imports split U.S. aluminium sector – by Andy Bell (Reuters U.K. – June 19, 2020)

https://uk.reuters.com/

LONDON (Reuters) – A surge in Canadian aluminium imports “is destroying what remains of the United States industry”. The dramatic warning comes from the American Primary Aluminum Association (APAA), which represents Century Aluminum and Magnitude 7 Metals, two of the last three remaining primary producers in the United States.

The solution, they argue in a May 27 letter to U.S. Trade Representative Robert Lighthizer and Commerce Secretary Wilbur Ross, is to revoke Canada’s exemption from import tariffs.

The U.S. Aluminum Association (AA), which has a much larger membership including the country’s third producer Alcoa, vehemently disagrees.

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Some U.S. aluminum producers are again pushing for tariffs on Canada as others warn of ‘great Canadian distraction’ – by Gabriel Friedman (Financial Post – June 17, 2020)

https://business.financialpost.com/

Tensions around aluminum appear to be rearing their head again even as the new NAFTA is only weeks away from taking effect

Just weeks before Canada’s long-negotiated trade agreement with the U.S. and Mexico is set to take effect, there’s mounting speculation that Washington is preparing to re-introduce tariffs on Canadian aluminum in what’s likely to cause a political uproar with serious economic fallout for the domestic industry.

The U.S. is the primary export destination for Canada’s $13-billion aluminum industry, accounting for 83 per cent of its trade in 2018.

Nonetheless, in recent weeks, aluminum future prices on the Chicago Mercantile Market have risen, which some analysts attribute to behind-the-scenes lobbying efforts by two U.S. aluminum producers, pressure from other aluminum producing countries, and the likelihood that U.S. President Donald Trump will impose new restrictions on Canadian aluminum.

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COLUMN-The more exposure to China the better for metals post-coronavirus – by Clyde Russell (Reuters U.S. – June 2, 2020)

https://www.reuters.com/

LAUNCESTON, Australia, June 2 (Reuters) – The contrasting fortunes of the prices of industrial metals inside and outside of China serves to illustrate two trends as the Asian region starts to emerge from coronavirus lockdowns.

The first is that the recovery is uneven and likely to remain so, and the second is that the more exposed to China the commodity is, the greater the likelihood it outperforms those metals that are not.

The best example is iron ore, the steel-making ingredient of which China accounts for two-thirds of the global seaborne trade.

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COLUMN- U.S. aluminium’s negative price puzzle as premium crashes – by Andy Home (Reuters U.S. – May 27, 2020)

https://www.reuters.com/

LONDON, May 27 (Reuters) – Aluminium has been one of the industrial metals hit hardest by the coronavirus. The London Metal Exchange (LME) price hit a four-year low of $1,455 per tonne in April and is struggling to recover, last trading at $1,525.

Inventory has surged, with 663,475 tonnes of metal placed on LME warrant since the middle of March, lifting headline exchange stocks to a three-year high of 1,493,775 tonnes.

COVID-19 has crushed both demand and price with a collective producer supply response lacking. Poor global market dynamics look even worse in North America, where the physical premium has imploded since March.

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Column: EU’s industrial strategy is being wrecked by coronavirus – by Andy Home (Reuters U.K. – May 20, 2020)

https://uk.reuters.com/

LONDON (Reuters) – German zinc producer Metallwerk Dinslaken (MWD) has just announced it is closing. You’d be forgiven for not noticing.

The news didn’t register with the London Metal Exchange (LME) zinc price. The company is too small with just 41 employees and annual production of 25,000 tonnes, a metallic drop in the 13.5-million-tonne global zinc ocean.

It’s also a secondary processor, converting scrap back into refined metal, and the notoriously opaque recycling sector doesn’t feature much in zinc’s market narrative. Yet companies such as MWD are supposed to be the beating heart of the European Union’s (EU) newly-unveiled industrial strategy.

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Alcoa CEO Sees No Certainty a Definitive Recovery Is Coming – by Joe Deaux (Bloomberg News – May 14, 2020)

https://www.bnnbloomberg.ca/

(Bloomberg) — Alcoa Corp. Chief Executive Officer Roy Harvey isn’t ready to declare that the world is on the road to recovery yet.

Speaking at a virtual metals and mining conference, the head of the aluminum producer said there remains too much uncertainty in global economies to feel comfortable saying the situation is improving from the coronavirus crisis. Aluminum gluts are now growing outside China, which Harvey said is already oversupplied, and this will further weigh on prices.

“I don’t think we’ve yet got the clarity, nor do we have the orders on the books, to signal that there is a definitive recovery coming,” he said.

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COLUMN-Trump’s tariff wall breached by rising tide of aluminium – by Andy Home (Reuters U.S. – May 7, 2020)

https://www.reuters.com/

LONDON, May 7 (Reuters) – It’s two years since U.S President Donald Trump imposed 10% tariffs on imports of aluminium, citing national security concerns.

The stated aim was to provide a lifeline to domestic producers struggling against low prices and repeated waves of cheap product imports. Things aren’t panning out too well.

Don’t take my word for it. Take the word of the four U.S. lawmakers who have just written to Trump, warning, “it is clear that your current policies are not working”.

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Reeling Aluminum Market Braces for Mining Giant Alcoa’s Outlook – by Joe Deaux (Bloomberg News – April 23, 2020)

https://www.bloombergquint.com/

(Bloomberg) — With the coronavirus crisis clouding the outlook for almost every industry, the aluminum market is hoping to get at least a glimpse of what’s in store from top U.S. producer Alcoa Corp. on Wednesday.

Aluminum, found in everything from jets to iPhones, has been among the worst-performing commodities during the crisis as governments lock down large swathes of their economies. Speculation is rising that the pandemic will spur shutdowns of smelters, which extract the metal from ore for use in applications.

Alcoa, which is set to report first-quarter results on Wednesday, typically also provides an outlook. It forecast in January that global supply would exceed demand by as much as 1 million metric tons this year.

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Canned Food Sprees Won’t Save Aluminum – by Clara Ferreira Marques (Bloomberg News – April 6, 2020)

https://www.bloomberg.com/

Aluminum isn’t the worst-performing base metal this year, an honor that goes to copper. Yet that’s only because it had less far to fall: Demand was ailing well before the coronavirus forced some three billion people to stay home.

Add the near-total shutdown of the world’s auto and aviation industry, crunching more than a third of demand, and the lightweight metal is fast heading for levels last seen during the global financial crisis.

That should translate into some of the mining industry’s deepest cuts as the pandemic forces producers such as Alcoa Corp. and Rio Tinto Group to take long-overdue decisions.

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