Section 232 import tariffs on primary aluminum imports from Canada are a hindrance to the US domestic aluminum supply chain since the former is a big supplier, Tom Dobbins, president and chief executive officer (CEO) of the Aluminum Association (AA) noted.
In a recent press brief held by the AA, Dobbins said that Canadian hydropower-produced primary aluminum plays a vital role in the industry, especially with domestic producers, such as Century Aluminum, struggling to find low-cost power to run their smelters. This is also one of the factors that resulted in 20pc lower primary output during Q1 2021 from a year ago, Dobbins added.
Keeping this in mind, the AA wants Canada, along with other fair-trading countries to be put on an exemption list from 232 tariffs. However, the association does not support a complete reversal of these tariffs due to unfair trade practices such as dumping and subsidization of products still being practiced by countries like China.
Buddy Stemple, CEO at Constellium Rolled Products, pointed out that many primary mills are now using scrap as feed in new production, which has better energy consumption than primary metal made from alumina. He noted that fully recycled aluminum has a 1:10 energy consumption ratio over alumina smelted aluminum.
As for the scrap industry, the AA now estimates that 80pc of all aluminum produced today is recycled metal. Moreover, large aluminum players like Novelis, Alcoa, and Norsk Hydro plan to increase their recycling rates.
The aluminum industry itself, seems resilient, with new orders up 30pc in March from a year ago, according to Marco Palmieri, senior vice president at Novelis. Still, he noted that jobs in the industry had fallen by 9.5pc as of February, compared to last year.