Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

Exports of standard P1020 primary aluminum ingots from Canada to the US could fall by 30pc in July compared with the previous month, according to the Aluminum Association of Canada.


The association expects Canada to ship around 112,000mt of P1020A in July compared with 115,000mt exported to the US in June. Last month, exports of the commodity to the US dropped by 16pc from May’s shipments of 184,789mt.


The decline of P1020 over the past two months could be attributed to a rise in exports of Value Added Products (VAP). The demand for the latter had fallen sharply in the first half of 2020 after automotive manufacturers suspended operations due to the COVID-19 pandemic. However, VAP demand has risen since late May after most carmakers restarted their facilities.


The Aluminum Association of Canada noted that smelters had switched to producing ingots as the market for VAP declined, but are now rebalancing their production due to renewed demand for the products. 


Jean Simard, president and chief executive officer, Aluminum Association of Canada said that even though smelters renewed their focus on producing VAP for exports, the rebalancing process had not caused a surge in Canadian exports of the material to the US. 


Alluding to the recent controversy over the US threatening to reinstate Sec 232 tariffs on Canadian aluminum, Simard said it was imperative for Canada and the US to work together to honor the USMCA. He added that any move to increase tariffs would only result in increasing the prices being paid by “North American manufacturers and the consumers who buy their products while making room for metal from other countries like Russia and China.” 

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