The snapshot of China’s April trade data released this morning showed a further acceleration in exports of aluminium product.
They were 196,710t last month, which extends the recent acceleration to a fresh monthly record. At 605,522t in the first fourth months of the year, exports were almost double those in the same four-month period of 2006.
The recent surge in exports of “product” is a direct reaction by local players to the hike in the export tax on primary metal in November last year.
The jump from 5% to 15% in the export duty has fed through to significantly lower primary exports. The latest figures for April do not differentiate between primary metal and alloy but at a combined 50,850t, they were up marginally on both March and February but well off the pace of April last year, when the equivalent figure was 117,900t.
Rather, Chinese smelters are now boosting exports of products to capitalise on the fact they still attract an export tax rebate ranging from 8% to 11%.
Not for much longer, though, judging by the heavy hints coming out of the country that the authorities are poised to close that loophole. Indeed, the super-strong April figure may well represent local players trying to boost exports of products before the shutters are pulled down by Beijing in the form of a significant reduction, or even elimination in some cases, of rebates on overseas shipments of products.
As usual, we’ll be looking in more detail at the April trade figures when the full report is released later this month.
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