On April 17th, President Biden proposed raising tariffs on Chinese steel and aluminum to 25%, citing "unfair competition," during his visit to the headquarters of the United Steelworkers Union.
Following suit, Mexico's President Lopez signed a decree on April 22nd imposing temporary import tariffs ranging from 5% to 50% on 544 items including steel, aluminum, textiles, clothing, shoes, wood, plastics, and their products. However, due to aluminum shortages, Mexico later canceled the 35% tariff on aluminum imposed since late April.
On May 14th, the US released the results of a four-year review of the 301 tariffs on China, announcing further increases in tariffs on imported electric vehicles, lithium batteries, solar panels, critical minerals, semiconductors, as well as steel, aluminum, port cranes, and personal protective equipment. Among them, aluminum tariffs will increase from 0-7.5% to 25%, while tariffs on electric vehicles will rise from 25% to 100%.
Looking at China's aluminum-related exports in 2023:
For primary aluminum:
China exported about 150,000 tons of primary aluminum in 2023, with less than 360 tons exported to the United States. Therefore, the tariff policy has little impact on the export of primary aluminum.
For aluminum products:
China exported a total of about 5.29 million tons of aluminum products in 2023, with around 230,000 tons exported to the United States, accounting for about 4.3%. China's exports of aluminum products totaled around 2.8 million tons in 2023, with exports to the United States accounting for approximately 15%. Therefore, the US tariff increase policy will have a certain impact on China's subsequent exports of aluminum products to the United States — the cost of exporting aluminum products to the United States may increase, leading to a potential reduction in export quantity. This may also widen the overseas aluminum supply gap. In the short term, this may lead to expectations of stronger London aluminum and weaker Shanghai aluminum, while in the long term, it may affect the global supply and demand pattern of aluminum-related products.