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Collapses of the U.S Aluminum industry

2015-12-26

Not only the United States Steal industry but also the United States aluminum industry are facing great threatens by the China’s aluminum industry. The foreign media point that reason on china. The world's three major aluminum producer Alcoa, announced to decrease the production of aluminum smelting capacity of 50.3 million tons and alumina refining capacity of 1.2 million tons due to operating at a loss, accounting for the 3% of production in the United States.

Alcoa bulletin pointed out that the company will be temporarily closed alumina refinery in the U. S. state of Washington and New York, and reduce the Texas plant refining capacity, time for a period of 1 year. Global aluminum Harbor Intelligence analysts estimate that Alcoa will cut the nation's aluminum production capacity by about 3 percent, but that is less than 1% of the global total, in addition to more estimates, if aluminum prices fail to rebound next year, All the United States smelter closures will occur. Bank of America believes that last year China aluminum industry production surged global oversupply, the current international price of aluminum fell to the 6-year low, leading to more than 50 percent of the world's aluminum producers are operating at a loss, only China's aluminum smelting providers still have benefits. Harbor Intelligence estimates that this year China's aluminum production may account for 55% of the world.

Wall Street knowledge had earlier reported that Chinese domestic aluminum industry suppliers exploit tax loopholes, the re-export of finished aluminum dress contractors, so not only do not need to pay a 15 percent export tax, but also get a 13% value-added tax refund from semi-finished products, so China's export of aluminum in the world is quite competitive. However, the international aluminum prices continued to decline also hurt the Chinese aluminum companies, in order to reduce losses, last month, China's largest Chinese aluminum, in the third quarter its total revenue decline 9.08%, while after-tax loss of 930 million yuan, becoming "the king a loss" of last year. Although the first half of this year the company made some improvement, the second half of the year the losses renewed.

In order to stop bleeding ASAP, China Fushun Aluminum industry announced that its entire electrolytic aluminumproduction linewill be shut down, and China Liancheng Aluminum also announced that all electrolyzer will be stopped, the two companies together to close nearly one million tons of production capacity, if aluminum prices continued to decline, there will be more of aluminum companies cut off. Besides the Importsof semi-finished aluminum from China to the United States continues to increase, this year the Middle East aluminum exports have also increased significantly. US government data showed that in the first eight months, Saudi-Arabia exported to the United States a total of 66,000 tons of aluminum, much higher than the 2,700 tons in last year.

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