This week brought news of one more anti dumping proposal against China. This time around, a department under India’s Ministry of Commerce and Industry proposed imposing an anti dumping duty on the imports of Chinese aluminum foil. This follows multiple complaints by members of the domestic aluminum industry regarding cheap foil flooding the market.
Aluminum foil is used as a packaging material to conserve and preserve food products. According to a foil market study by the Directorate General of Trade Remedies (DGTR), imports from China have taken over at least 30% of India’s local market share despite there being enough domestic production of aluminum foil.
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The Anti Dumping Probe Stems from March
India’s initial inquiry started in March 2024 after complaints by some Indian manufacturers, including Hindalco, one of India’s biggest aluminum manufacturers. Countries often conduct anti-dumping investigations to find out if an influx of cheap imports is hurting local industries. The Ministry of Finance then decides whether to apply duties. The duty proposed by the DGTR is between US $619 per ton and $873 per ton.
Meanwhile, China’s aluminum foil exports have increased since the start of 2024. As per a report by the Shanghai Metals Market survey, exports were 130,100 tons in May this year, roughly a 7% month-to-month increase (stay posted on how market shifts like this impact your company’s bottom link with MetalMiner’s weekly newsletter). India, along with Indonesia, Thailand, and even Mexico, are some of the countries seeing an influx of these Chinese exports. Of China’s total yearly aluminum foil exports, 60% went to top ten destinations like India.
Thailand’s Recently Launched a Probe of its Own
Incidentally, a few months ago, Thailand’s Department of Foreign Trade initiated a similar anti-dumping probe on extruded aluminum from China. This came after domestic manufacturers complained of cheap imports wrecking their economy.
The Thai government has already put anti-dumping duties and import caps on steel products from countries like China, Taiwan, Japan and Vietnam into effect, and have now started their inquiry into extruded aluminum imports from China. According to media reports, if they find the complaints to be true, more duties will be announced for the next five years.
In India’s case, the Ministry could face a dilemma. Some companies told the DGTR that bringing in a new anti-dumping duty could potentially harm producers downstream, since they would not be able to source high-quality material on time. They also cautioned that such a move would create a monopoly. Furthermore, the decision would be bound to have a negative effect on India’s flexible packaging industry.
Incidentally, the Indian Government recently mandated that all new products contain at least 5% recycled aluminum starting FY 2027-28. This will undoubtedly impact non-ferrous sectors like aluminum, copper, and zinc
While China may have reported growth in its aluminum foil exports this year, in the long term, many producers continue to report insufficient growth in monthly orders. Some experts even forecast that foil exports from the country may decline after now that August has passed.
Chinese Aluminum Industry Reaching Record Production Levels
China’s primary aluminum production is nearing last year’s record levels as previously idled capacity in the Yunnan province comes back online. According to the International Aluminium Institute, production increased by 5% year-on-year to 3.65 million metric tons in May.
National output is now close to an annualized 43.0 million tons, approaching the highs recorded last September and October. According to Reuters, improved rainfall in Yunnan has eased power shortages, allowing local authorities to lift operating restrictions and restart about 1.15 million tons of capacity that shut down last November.
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