MethodologyContact usLogin
The preliminary finding by the US Department of Commerce that the governments of China, Indonesia, Mexico and Turkey were unfairly subsidizing their aluminium extrusions industries is likely to pressure supply and affect the premium, according to market participants.
Commerce announced on Tuesday March 5 that it calculated affirmative preliminary duties of 15.41-169.66% for imports from China, of 6.69-43.56% for imports from Indonesia, 1.68-77.80% for imports from Mexico and 1.45-147.53% for imports from Turkey.
Commerce is expected to publish its preliminary determination within the next week and instruct US Customs and Border Protection to begin collecting duties on aluminium extrusion imports into the US from these four countries.
Sources told Fastmarkets they expect the decision to pressure the premium higher.
“That being said, the margins are so wide that it may not deter people from bringing in material from [other destinations]” a trader said.
“This is going to depend on how high the duty is,” the source added.
A second trader said companies that are assigned duties at the higher end of the range will not be as competitive in the US market.
This would deter billet imports, causing supply to tighten and drive the premium higher, according to the second trader.
“There will be a run up both in price and in need for billet,” the second trader said.
Commerce is expected to make its final decision in July after a verification period, but the final decision may be extended into September, according to a source familiar with the matter.
This source noted that the duty amounts announced were preliminary and subsidy rates could increase before the final decision.
The source also said that the recent determination concerned only the subsidy cases but there were anti-dumping petitions against 14 countries and regions including these four.
“The Commerce Department’s preliminary determinations in the anti-dumping duty cases on these four countries, as well as 10 other [countries and regions], are currently scheduled for early May 2024,” according to a statement on Tuesday by Wiley Rein LLP, who represented the petitioners the US Aluminum Extruders Coalition and the United Steelworkers union in the case.
In November, the US International Trade Commission found that there was reasonable indication that the American aluminum extrusions industry was “materially injured by reason of imports” from China, Colombia, Ecuador, India, Indonesia, Italy, Malaysia, Mexico, South Korea, Taiwan, Thailand, Turkey, United Arab Emirates and Vietnam.
The billet premium has been weak in the US on subdued demand.
Fastmarkets last assessed the aluminium 6063 extrusion billet delivered premium at 8-10 cents per lb on February 23.
The premium has decreased by 5.26% from 9-10 cents per lb at the beginning of the year and by 45.45% from 15-18 cents per lb a year ago.
To understand the complex market conditions influencing price volatility, download our monthly base metals price forecast, including the latest copper price forecasts today. Get a free sample.