United States aluminum sector urges Britain and EU to unite against China

United States aluminum sector

Representatives of the United States aluminum industry are speaking to European Union counterparts and have written to British Prime Minister: Theresa May, commending action against what they say are massive illegal subsidies in China that threaten Western jobs. In accordance to this, trade lawyers and some governments accuse China of unfairly subsidizing major industries in breach of the rules or the World Trade Organization.

It has lodged a complaint with the World Trade Organization and launched an investigation into whether Chinese imports compromise national security.

Given this statement, CEO of Century Aluminum Company (CENX.O), Michael Bless, said “The World Trade Organization, United States and European leaders must act quickly to ensure a fair playing field” on a news conference in London on Wednesday. China, on the other hand, says that it supports the work of the WTO.

Relevance to this event, the aluminum industry, represented by the China Trade Taskforce, has written to British Prime Minister May, urging her to actively engage with the WTO on this matter and press for action. On the other hand, the Prime minister’s office had no immediate comment.

Industry leaders said they were also speaking to Brussels officials as well as to the Russian sector, which has floated idea of an OPEC-style body for the aluminum industry. Bless said he could not endorse that, however he considered it as an acknowledgement of the severity of the issue.

China represented just over 10% of aluminum production worldwide, as what the China Trade Taskforce said. However, China is considered the biggest aluminum consumer in the world. Now it is the world leader, accounting for more than 50% of global output and China’s Hingqiao has taken over Russia’s Rusal as the biggest producer, while the United States and European sectors have shrunk.

In accordance to this, Industry body European Aluminum said that the number of primary European aluminum smelters fell by almost 40% between the years 2002 and 2015. Trade lawyers say the dominance of China’s aluminum sectors defies commercial logic as it faces higher bills for energy—the biggest input cost than the United States and Europe.

As what Wiley Rein, Alan Price of Washington law firm said: “China has no natural advantages other than illegal state support.” Part of the justification for the United States investigation into whether Chinese aluminum is a threat, is that—Century Aluminum in Kentucky is the only producer of high-purity aluminum, which is required for United States combat aircraft.

In Europe, on the other hand, the main concern is how to maintain smelting capacity as a part of a strong value chain, creating thousands of indirect jobs, rather than security.


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