China's net exports of primary metal continued to creep higher in September, according to the latest trade report from the country's customs department.
Net exports were 66,500t in September, the third consecutive monthly increase and a new monthly high for 2006.
Cumulative net exports over the Jan-Sep period were 425,900t. That was still down by 28.7% on the year-earlier period but the gap has started to narrow sharply from over 40% through much of the Jan-Aug period. The timeframe is significant since exports of primary fell away sharply from August 2005 onwards as a result of the authorities' clampdown on the tax-efficient use of toll-smelting.
Outright exports in September actually dipped to 84,230t from August's 94,100t but again the cumulative Jan-Sep year-on-year decline in exports to 674,000t has narrowed to 26.3% from over 40% in much of the first half of the year.
But outright imports also fell much more sharply to 17,700t in September from 39,250t in August, which is why the level of net exports rose.
One of the underlying trends in the country's aluminium trade this year has been an acceleration in exports of alloy, reflecting smelters' reaction to tax differentials between primary and alloy.
At 288,900t over Jan-Sep alloy exports were up by 181,200t on the year-earlier period and close to what the country exported over the whole of 2005.
There has been only an incremental 8.9% rise in imports of alloy over the same period to 164,900t, meaning the country has switched from being a net importer of alloy last year to a net exporter this year.
Net exports of primary and alloy together also recorded a fresh 2006 high of 71,600t in September, while cumulative net exports of 425,900t were "just" 23% off the pace of last year's level.
We'll be looking in detail at China's alumina and scrap trade in Thursday's issue of MI.
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