China unexpectedly restricts the import of scrap metals. Trump may be imposing new duties on Chinese aluminium sheet products. And did you know that a tribe in Africa, the Haya, created the world’s first carbon steel as far back as 100AD? Here’s the news from Metalex, your trusted Aluminium Suppliers, Carbon Steel Suppliers and Metal Stockists.
Scrap metal imports restricted by China
Scrap firms all over the world have been freely shipping red metal scrap to China for recycling. Now they’ve been left hanging thanks to China’s unexpected new restrictions on scrap imports. And the import bans are contributing to an equally unexpected slowdown in the worldwide supply of copper, a problem that has hit Asia particularly hard.
The Shanghai Futures Exchange, London Metal Exchange and Chicago-based COMEX market are all suffering low inventory and exchange pricing is flat, but physical premiums are actually rising as Asian copper producers, sellers and buyers do their best to adapt to the fast-changing dynamics of the scrap sector. August’s 25% US scrap tariffs didn’t help matters. Now China has placed new restrictions on the purity of copper scrap imports, an act that has slowed down the overall movement of the metal worldwide.
In the past China transformed imported red scrap into refined copper, which was quickly fed back into the market. Now the lack of scrap means there’s a real restriction on finished copper availability in Asia, which could easily spread to affect other regions.
During 2017 and into this year, a growing number of SMEs in China’s recycling sector have moved their processing operations abroad to places like Malaysia, Vietnam, Thailand, Taiwan and Japan. Rumour has it these countries might be the latest focus for Chinese investment, a prediction that might see governments in these countries also getting feisty about scrap imports, potentially leading them to make sudden, potentially disastrous policy changes of their own.
China’s government has hinted it might ban all scrap imports by the end of 2020. On the other hand such a drastic decision would probably cause chaos in their domestic refined metals market, ushering in difficulties throughout the entire copper scrap chain.
New US duties applied to Chinese aluminium sheet products
Will the US Commerce Department impose more anti-dumping and anti-subsidy duties on Chinese common aluminium sheet products? Probably. The decision is expected to affect aluminium sheet products of 96.3% to 176.2%, marking the first time final duties have been issued in a North American trade remedy case since the mid ’80s.
The reasoning behind this latest predicted tranche of duties? Apparently it’s down to a surge in ‘low-priced, unfairly traded imports of common alloy sheet from China’, a trend which has shot up around 750% over the past ten years and by almost 100% between 2014 and 2017 alone. This has led to large market share gains by Chinese imports at the ‘direct expense’ of the USA.
Trump had originally threatened a much more aggressive approach to trade enforcement, but the final aluminium sheet duties set in April and July were slashed, reduced from the original combined range of 198.4 to 280.46%.
During 2017 Chinese common alloy aluminium sheet imports reached an estimated US$900 million, used mainly for transport, construction, infrastructure, electrical and marine applications. The US International Trade Commission will make its final decision on 20th December, having already voted in and authorised the investigations during January.https://www.metalex.co.uk/wp-admin/post.php?post=3035&action=edit#
The Haya people invented carbon steel in 100AD
You thought carbon steel was a relatively modern material. Think again. Way back in 100 AD, the Haya tribe invented carbon steel. The African tribal elders were in charge of the process, which involved creating carbon from mud and grass, then combining it with iron in a sophisticated open furnace to produce the metal.
The quality of this ancient African carbon steel was remarkable, much better than the European version that didn’t arrive until centuries later. No wonder when the Haya were such an unusually sophisticated people. They grew banana, beans, coffee, tea, plantain and maize. As fine fishermen and a people who were famously talented in animal husbandry, the Haya actually traded coffee far and wide way before the invading Europeans arrived. Next time you pick up a chunk or carbon steel, give the Haya a nod of respect.
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