China’s aluminum exports inched higher and steel shipments jumped in April, customs data showed on Tuesday, as U.S. import tariffs failed to dent overseas shipments from the world’s biggest producer of the two metals.
The United States imposed a 25 percent duty on steel imports and a 10 percent tariff on aluminum imports, effective from March 23 as U.S. President Donald Trump sought to protect U.S. metal makers.
The impact of the tariffs on aluminum was offset by U.S. sanctions on giant Russian producer Rusal that caused a spike in international prices, prompting Chinese firms to send more metal abroad, analysts said.
“Exports are still happening, which suggests the tariff is not really having a material impact at this point,” said Lachlan Shaw, a metals analyst at UBS in Melbourne.
“Certainly anecdotal reporting from within the U.S. aluminum products manufacturing sector suggests that some fabricators are just paying the tariffs to secure the required imports. So it appears that trade is holding up for now,” he added.
China’s unwrought aluminum and aluminum product exports came in at 451,000 tonnes last month, up 0.2 percent from a revised 450,000 tonnes in March and up 4.9 percent from 430,000 tonnes in April 2017, the General Administration of Customs said.
Steel exports jumped 14.7 percent from March to 6.48 million tonnes, their highest level since August last year, and steady with a year ago.
April has one less day than March, so the latest increases are greater on a daily basis.
The United States accounts for around 14 percent of China’s aluminum exports, but only 1 percent of its steel exports.
Washington imposed sanctions on Rusal, the world’s second-biggest aluminum producer, on April 6, causing London Metal Exchange aluminum prices to climb 12.5 percent last month on fears of a supply shortage.
Shanghai aluminum prices rose only 4.8 percent in April in a well supplied Chinese market, with the wider price arbitrage making Chinese exports more profitable.
The jump in steel exports came despite the tariffs and a 7.6 percent jump in Shanghai rebar prices in April, making Chinese steel more expensive.
“Exports went up while the steel price rallied and there was firm demand in China, which would mean steel output in China really went up a lot,” said Xu Bo, an analyst at Haitong Futures.
April was the first full month after the end of winter restrictions on industrial output in northern China, including on steel and aluminum, although some key steel cities still have curbs in place.
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