Alert: China's New Tariffs on Scrap Aluminum

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Latest ISRI update: "ISRI learned late last night that the Chinese Government announced its intent to target 128 U.S. product exports in retaliation for the Trump Administration's imposition of tariffs on steel and aluminum imports. On the Chinese Government's list is the intent to impose a 25% import tariff on Harmonized Tariff Code 7602.00 – Aluminum Waste and Scrap.

In 2017, the United States exported more than $1.2 billion worth of aluminum scrap to China, which has been in a positive trade balance for more than a decade. The Chinese Government's announcement will impact this significant U.S. scrap export, spurring concern that exports of additional scrap commodities could be impacted in future announcements.

The tariffs will not be imposed immediately. There will be a 30 day open comment period, and ISRI will submit comments that provide information on the supply chain impact of these tariffs. Additionally, ISRI is working with the Administration and members of Congress to find a path towards minimizing the impact of these tariffs."

Additional facts: 

  • The U.S. exported $2.34 billion/1.57 million metric tons of aluminum scrap worldwide in 2017. Approximately 50% of these exports went to China.
  • The U.S. exported $1.17 billion/820,000 metric tons of aluminum scrap to China in 2017. This was approximately 50% of China’s total imports of aluminum scrap that year.
  • A 25% tariff would mean a nearly $300 million price burden on a trade relationship that represents nearly 25% of the entire world’s trade in aluminum scrap.
  • Aluminum in the municipal recycling stream represents a substantial source of revenue that keeps down the cost of waste disposal and recycling programs.
  • The second largest exporter of aluminum scrap to China in 2017 was the European Union at $360.51 million/231,556 metric tons.
  • The U.S. has an overwhelmingly large positive trade balance in aluminum scrap vis-à-vis China. The United States’ positive trade balance with China in aluminum scrap is $1.17 billion for 2017 which is 94% of our positive trade balance with the entire world.
  • South Korea ($248.6 million), India ($110.7 million), Hong Kong ($72.6 million), and Malaysia ($69.5 million) complete the top 5 economic partners with a positive trade balance in aluminum scrap with the U.S.

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