Benoit Verreault’s Post

China's aluminium semis exports saw an annual fall of 16% during Jan-Nov 2023. To enhance the overseas supply in 2024, China cuts export tariff from 30% to 0%. #chinesealuminium #chinesemarket #aluminium

China's Imports Of Unwrought Aluminium Were The Second Highest Annual Total Since The Start Of The Century Russian aluminium dominates LME stocks. Due to sanctions and tariffs, Russia has shifted its exports from the US and Europe to the LME, where it accounts for 90% of the inventory. China is currently the largest purchaser of Russian aluminium. In 2023, China imported 1.18 million tons of Russian metal, a significant increase from the 291,000 tons imported in 2021. Additionally, China imported more Russian alloy and alumina, the raw materials necessary for aluminium production. Despite facing challenges and opportunities, Russia and China have the potential to benefit from their cooperation and innovation in the aluminium sector. Geopolitical tensions and environmental pressures could potentially disrupt the supply and demand balance of aluminium, but by working together, the two nations can overcome these obstacles. Russian metal accounted for just 18% of 2021 volumes, a ratio that jumped to 76% last year as penal import duties in the U.S. and self-sanctioning in parts of Europe disrupted previous Russian trade patterns. Russia and China are becoming increasingly dependent on each other in the aluminium market. The London Metal Exchange (LME), which has historically been the market of last resort for unsold metal, is already sitting on high stocks of Russian material. Can China, the world's largest aluminum producer, continue to absorb what others don't want and more specifically production from Russia? The London Metal Exchange (LME) can only hope so. Chinese imports of Russian-brand aluminium, by contrast, totalled a relatively modest 291,000 tons in what was the last full year of trade before the February 2022 invasion of Ukraine. Flows of Russian material rose to 462,000 tons in 2022 and then leapt to 1.18 million tons last year. Imports of Indian metal dropped to just 98,000 tons over the same time-frame. Some of the metal moving from Russia to China has been smelted from Chinese alumina, the intermediate product between bauxite and refined metal in the production chain. The company has become increasingly reliant on Chinese supply, cementing the dependency with the purchase last October of a 30% stake in Hebei Wenfeng New Materials, which operates a recently built alumina refinery with annual capacity of 4.8 million tons. Just as Rusal metal dominates China's imports of primary aluminium, the company also accounts for a large part of China's alumina exports. Shipments to Russia came to 1.12 million tons last year, representing 88% of total export flows. The two countries' alumina trade amounted to a paltry 1,747 tons in 2021. Indeed, without the Russian connection it's doubtful China would be exporting much alumina at all, given recent signs of stress in that part of its production sector. https://lnkd.in/evzDdeG6 #aluminium

Declining Chinese Copper imports have some messages In the last eight months, Chinese imports of #refinedCopper and products have fallen by 450kt (when compared with the last year). This is one of the largest (in volume) and the longest (in period) fall in imports. #China is a net importer of Copper. The country imports nearly 450kt-550kt of refined Copper and products every month. In 2022, its imports totalled 5.87 million tons, customs data show. Since Dec 2022, Chinese imports have declined every month by an average of 11%. The world’s largest importer and consumer of red metal is slowing imports; it surely has some messages. First, the country’s local output is rising at a handsome pace. This is replacing the imports. In the first six months of this year, Chinese Copper output rose by an average 16.2% y/y, the quickest since Q4 2019. Several new smelting capacities are lined up for commissioning till 2025 with businesses investing ahead of growing demand for this “green” metal. Second, a tight vigil on import financing by the regulator has reduced the use of Copper for collateralised overseas financing deals. This business was already on a decline after the bankruptcy of Maike in Aug 2022. No surprise that the bonded stocks of Copper have fallen to merely 60,000 mt in recent weeks, down from more than 300,000 in Q1 2022. Third, slowing demand undercurrent has reduced consumer inventory levels. Except for consumer goods, all Copper consumer industries have been reporting negative growth and uncertain outlook. The line-up of new capacity additions in the rest of the year and slowing local demand for consumer goods suggest that Copper’s imports into China could extend for the rest of the year. If it does, it would be the longest slide in Chinese imports in recorded history. However, the big question is something else. Reduced Chinese imports are (and may continue to) leaving the rest of the world will more Copper inventories. With the West slowing as well, who would absorb them? If not, will they show up in exchange warehouses? At MIC, we surely see that happening. If you are interested in our reports, contact us either through Linkedin chat or email us at micsupport@regsus.com.

EU slab imports from China surged 70% on-year to 624,051 tonnes in 2023 as main buyer Italy used Chinese slab to replace supply from war-torn Ukraine. Italy also reduced slab intake from Indonesia last year. Although EU slab imports from Russia fell 10% in 2023, Italian imports of Russian slab rose 4%. Sources point out that Chinese suppliers chose to export slab to the EU because prices of hot rolled coil were depressed in Asia last year. With CIS slab restricted and merchant slab supply within the EU limited, Chinese slab availability amid weak demand in China’s domestic market came at an opportune time for EU buyers. However, this may no longer be an option if the reports of a Chinese semi-finished steel export ban prove to be true. EU imports of iron and steel from China in 2023 meanwhile reached their highest level since 2016, Kallanish Commodities reports.

In the first four months of 2024, the European Union reduced its imports of semi-finished products from Russia by 3.8% to 1.2 million tonnes. Semi-finished products took the largest share, accounting for 79.3% of total imports. Import expenditure fell by 16.3 % to EUR 801.15 million.

According to China's General Administration of Customs, imports for the year totaled a record high of 474.42 million tons. This was also higher than analysts' expectations of 460 million to 470 million tons for the year. Coal imports also hit a record high last month at 47.3 million tons, up 8.7 percent from November, as a record cold snap in many parts of the country drove demand for coal. Buyers also began stocking up ahead of the Lunar New Year holiday, which begins on Feb. 10 this year. China's cabinet last month reinstated a 3%-6% tariff on coal imports from countries without bilateral free trade agreements, effective from January 2024, which mainly applies to major suppliers Mongolia and Russia. #coal #importexport #internationalbusiness #globaltrade

To cut reliance on China, Russia turns to India for aluminium feedstock LONDON : Russia has stepped up imports of the aluminium feedstock alumina from India in recent months to supply its vast Siberian plants, a move that diversifies the sanctions-hit country's supply, helps reduce dependence on China and cuts costs. After invading Ukraine, the world's second biggest producer of aluminium lost two crucial sources of alumina, used to make aluminium metal, as a refinery in Ukraine suspended production and Australia banned supplies to Russia. While Russia and China are on friendly terms, aluminium production in China is rising, leaving less price flexibility for Russia to buy alumina. Russia's Rusal, the world's largest aluminium producer outside China, needs to fill the gap left by suspended supplies to sustain domestic production while aiming to protect its margins against a weaker aluminium price backdrop. The company's own alumina assets in Russia, Ireland, Jamaica and Guinea supply 70% of its needs, or 5.5 million metric tons. "After deliveries from Ukraine and Australia were lost, Rusal replaced it with increased alumina imports from China and other refineries in Asia, but it came at a considerable cost," Ami Shivkar at WoodMac said. Russia became the largest buyer of alumina from China last year. Rusal's cost of purchasing alumina jumped by $1.1 billion to $1.8 billion in 2022 as it had to pay more for the raw material and for delivery. Rusal has since diversified by securing alumina supplies from India and Kazakhstan. "We can already say that the company's total alumina costs will decrease in 2023 compared to 2022," Rusal told Reuters. Russia was the second largest buyer of Indian alumina in the first half of this year, Indian customs data show, with India exporting 189,379 metric tons to Russia. There were no exports in the same period of 2022. "Russia encountered difficulties in securing alumina from developed nations and forced it to switch to India," an Indian industry official, who declined to be named, told Reuters. India's state-run National Aluminium Co is the primary supplier of alumina to Russia, the official said. Nalco did not respond Reuters' request for comment. Russia is expected to buy more than 350,000 tonnes of alumina from India in 2023, the official said. The estimate is broadly in line with Rusal's own calculations, it told Reuters. China remains the largest third-party supplier of alumina to Russia with shipments of 485,160 tons in January-June, but it has less alumina to offer this year due to rising domestic aluminium production. Aluminium of Kazakhstan, which produces 1.3 million tons of alumina a year, plans to reduce supplies to Russia by 5% in 2023 as it also needs more product for itself. The company did not say how much alumina it sends to Russia, however CRU consultancy estimates Kazakh deliveries to Russia at around 40,000-70,000 tons per month. #finance #stockmarket #stocnerv

Indian steel sector flags Chinese imports, wants 'trade distortions' fixed Industry association plans to write to government to seek 'level-playing field' Worried by a spike in Chinese imports, the Indian Steel Association (ISA) plans to take up the matter with the government and seek measures to fix "trade distortions". https://lnkd.in/d-3-DtZu

Data show that in the first three quarters of 2023, Turkey’s semi-finished steel imports increased by 46% year-on-year to 4.6 million tons. In October, Turkey’s imports of semi-finished steel fell by 22% year-on-year to 352,500 tons. In October 2023, Russia remained Turkey's largest supplier of semi-finished steel, with transaction volume reaching 191,300 tons, a month-on-month increase of 37%, but a decrease from 338,000 tons in the same period last year. Other major suppliers include Indonesia (50,000 tons), Vietnam (31,000 tons), Malaysia (30,500 tons), Algeria (20,000 tons), and Iran (10,300 tons). The European Union announced on June 23 that as part of the 11th round of sanctions imposed on Moscow, starting from April 2024, all suppliers selling steel products to the EU must provide relevant documents to prove that the materials they use are not From Russia. The decision may have a certain impact on Turkey’s imports of semi-finished steel from Russia starting in March 2024. But until then, Turkey is likely to continue importing billets and slabs from Russia due to competitive offers from Russian steel mills.