The tariff war between China and the United States has escalated again since September 1. On September 1st the United States imposed tariffs of 15% on some $110 billion of Chinese imports, including clothes, shoes and some electronics. As well as a broad tariff crackdown, the us is also targeting "focus" industries. After steel, the United States has expanded the range of aluminum extrusions made in China.

On July 31, the U.S. department of justice issued an indictment against a Chinese company. On the same day, the Commerce Department's international trade commission signed a document.

The document stipulates a counter tax on aluminum extrusions originating in China and exported to the United States via Vietnam, retroactive to all outstanding products as of March 5, 2018. The document also stipulates that accused Chinese companies, as well as those in China, Vietnam, Mexico and other overseas countries owned by the same controller as identified by the United States, cannot apply for exemption.

On August 26, the indicted Chinese company released an insider's report that it was adjusting its spin-off plan, including but not limited to new plans such as adjusting its business scope and shareholding structure.

Experts surveyed said the amount of aluminum extrusions exported from China to Vietnam was small, so the impact would not be significant. But the U.S. move is likely to intensify counteractions by other countries against Chinese aluminum products and affect Chinese companies' overseas investment options.

The United States has a double reverse on "Vietnam" Chinese aluminum extrusions The U.S. department of commerce that is native to China and export to the United States from Vietnam aluminum extrusions, avoid the anti-dumping duties and countervailing duties in the United States, according to issued on May 17, 2019 "on Chinese aluminum circumvent anti-dumping and countervailing duties of a preliminary ruling", anti-dumping duties, tax range of products for aluminum, including using Chinese-made aluminum melt after the manufacture of aluminium billet, regardless of how the identity of the manufacturers, exporters, importers.

The U.S. department of commerce requires the U.S. customs and border protection agency to suspend customs clearance of imported aluminum extrusions, require companies to pay an estimated tariff deposit, and trace back to March 5, 2018 goods that have not been cleared; The anti-dumping duty deposit shall be charged at the anti-dumping rate of 86.01% on Chinese products, and the importer/exporter shall be charged at the specified rate on producers.

The U.S. department of commerce said aluminum extrusions made from materials other than Chinese and exported in Vietnam are not covered by the tax, but importers and exporters need to meet certain conditions to apply for an exemption.

But the U.S. department of commerce said in its filing that a Chinese group, its affiliates and affiliates, and overseas companies that the U.S. considers to be controlled by the same group's owners, would not be granted immunity certificates. At the same time, the aluminum extrusions produced, exported and imported by these enterprises in Vietnam cannot be exempted from the certificate. Still, first-half results were strong. The company recently reported that first-half sales rose 38.3 percent to 12.9 billion yuan and 63.7 percent to 532, 275 tons.

The impact on Chinese companies is limited

In addition to the 301 investigation and the 232 tariff, there is also the double countertax. The average tax rate is 90 percent to 100 percent. In addition to the 10 percent and 25 percent of 301 and 232, it is difficult to export directly from China to the United States." A person of nonferrous metal industry expresses to reporter.

Before this, aluminium foil, aluminium plate belt piece has been subjected to the United States double anti final determination of taxation.

According to customs data, China exported 662,500 tons of aluminum products in July 2019, increasing by 2.65% month-on-month and decreasing by 5.81% year-on-year. From January to July 2019, China exported 4.4068 million tons of aluminum products, up 1.60% year-on-year. Among them, the export volume of aluminum extruded products in July was 90,500 tons, with a year-on-year increase of 2.78% and a year-on-year decline of 1.77%. Vietnam, the Philippines and Nigeria were China's top three exporters in July.

In 2018, China exported 98,533.2 tons of Vietnamese aluminum, accounting for 10.19 percent of the total exports.

The United States believes that many aluminum products are exported to the United States through third countries from China. However, the nonferrous metal industry people believe that Vietnam does not have much ability to export indirectly to the United States."Vietnam's economic situation is at the level of our country 30 years ago. It has a large demand for building materials. Aluminum profiles are mainly imported doors, Windows and structural lines. The products imported from China are mainly used for domestic consumption in Vietnam." This person introduces.

Even if some companies import raw materials from China for processing and re-export, Vietnam's import volume of less than 100,000 tons is relatively small compared with China's production capacity of 40 million to 50 million tons, the person said.

However, no Chinese companies have started manufacturing aluminum extrusions in Vietnam, the person said. "In the local aluminum industry, 50 to 60 percent of the companies are Taiwanese and Japanese, while the rest are mostly local. If there is an impact, Vietnam's import producers may be more affected." Liu xiangdong, vice minister of the China center for international economic exchanges, said the U.S. move was aimed at the development of domestic industries in the United States, thus restricting imports. Alcoa reports that the boom in the Chinese aluminium industry (601600) threatens Alcoa's growth and employment.

Chinese companies need to be cautious about operating overseas"  The United States believes that Chinese products are heavily subsidized and that Chinese products are being dumped at low prices. This has a very bad impact on public opinion. "After the United States, in the last two years, many countries have filed trade barriers against us and imposed high tariffs." The nonferrous metals industry warned that the U.S. move could have a big demonstration effect.

According to incomplete statistics, since 2018, Argentina, Eurasian economic union, Lebanon, Mexico, Vietnam and other countries have launched bilateral counterinvestigation against our aluminum products.

On May 29, 2019, the ministry of industry and commerce of Vietnam decided to impose a 120-day provisional anti-dumping duty on imports of some aluminum profiles from China, ranging from 2.46% to 35.58%, involving Guangdong Xingfa aluminum, Jianmei aluminum, Aomei aluminum, Feng aluminum and other companies. Meanwhile, Vietnamese investigators will continue to conduct anti-dumping investigations and hold hearings for a final ruling. However, Liu xiangdong believes that other countries' double anti - espionage investigations cannot simply be seen as the influence of the United States, they are sovereign countries.

This is not the first time the us has imposed countervailing duties on goods originating in China that are exported to the us through a third country. In 2017, the United States announced that it would impose 199.43% anti-dumping duties and 39.05% countervailing duties on corrosion-resistant steel products from Vietnam using Chinese substrates, 265.79% anti-dumping duties and 265.44% countervailing duties on cold-rolled steel products from Vietnam using Chinese substrates." With a lot of cases filed against China in Europe, North America and Latin America, these countries will think that the certificate of origin of China is not good for trade." The nonferrous metal industry said.

According to Liu xiangdong, if enterprises want to avoid trade barriers and set up factories in a third country, such as Vietnam, to export to the United States, then the United States may carry out double-counteraction against the third country. If Chinese companies invest overseas only to meet domestic demand in their investment destinations, that's fine. Steel, textile and other industries have been a lot of sea enterprises encountered this situation."Countries like Vietnam and Cambodia are where China was 30 to 40 years ago, and economic development will provide a lot of potential demand," he said. (From Alu)