Producers of aluminium in India are lobbying the government for increased protection from imports, with their interest particuarly focused on China.

What happened?
The Aluminium Assn of India has met the government to ask it to increase duties on all imports of metal to 10% from 5%. The slowdown in domestic demand and overcapacity in the country has encouraged producers in China to sell material into new export markets.

Why is it important?
Rising exports of China’s semis have been the talk of the aluminium market since last year and have been seen as a key reason behind the fall in premiums in Asia and outright prices this year.

The exports have caused dismay to producers outside the country, which argue they are competing with subsidised imports.

China exported 450,000 tonnes of unwrought aluminium and aluminium products in June, up nearly 10% from the previous month and 36.4% higher than the same period last year, according to preliminary Chinese customs data last week.

The concerns expressed by smelters in India, which are not necessarily echoed by traders or consumers, echo the the complaints about rising Chinese exports made by producers such as Alcoa and UC Rusal.

The competition from imports has seen producers in India themselves look for new export markets, in Japan for example, according to some market sources.

What happens next?
Expect trade cases and anti-dumping petitions if the Chinese government does not clamp down.

Alcoa is considering all options in response to “fake semis” entering the west from China, including a trade case, ceo Klaus Kleinfeld said this month.

“The Chinese government is likely to deal with the situation before such a move becomes necessary,” he added.

Earlier in the year, Russian producer UC Rusal raised the issue of rising Chinese exports with the Australian government.

Last month, a US court upheld anti-dumping duties on aluminium extrusion imports from China’s Zhaoqing New Zhongya Aluminum.

Deepali Sharma