Aluminicaste Fundición de México S. de RL de CV's San José Iturbide, Mexico, facility .
NEW YORK U.S. aluminum extruders are considering filing a trade complaint after it emerged that a Chinese-owned billet producer is storing a massive stockpile of aluminum extrusions at a facility in Mexico.
Aluminicaste Fundición de México S. de RL de CV, a producer of secondary billet, slab and forging billet, is storing around 850,000 tonnes of aluminum extrusions at its San José Iturbide, Mexico, facility (amm.com, July 2).
Extruders are examining several legal options, including filing formal petitions with the U.S. Trade Representative, the Commerce Department and U.S. Customs and Border Protection, sources close to the matter told AMM.
The practice of importing extrusions from China and remelting them into billet is not illegal or known to violate any law, but extruders are concerned that Aluminicaste could be looking to circumvent anti-dumping duties.
"We believe its a circumvention of anti-dumping duties and is a way for Chinese-made aluminum products to enter the U.S.," one extruder source told AMM. "We hope that the outcome of these actions will lead to duties being applied to billet shipped from that facility to the U.S. We also hope that those duties will be similar to those currently being applied to extrusions shipped from China into the U.S."
The stockpile is comprised largely of finished shapes, or extrusions, shipped from extrusion plants in China. The shapes allegedly are being remelted back to billet, which is then shipped to various countries, including the United States.
Commerces anti-dumping and countervailing duty orders on Chinese-origin 1000-series, 3000-series and 6000-series aluminum alloy extrusions are 33 percent and 10.6 percent, respectively.
Aluminum alloy billet shipped into the United States from Aluminicaste does not qualify for preferential treatment under the North American Free Trade Agreement (Nafta), according to a recent ruling by U.S. Customs and Border Protection (amm.com, July 3).
"I think an action plan should be formulated as soon as possible to address the situation with U.S., Mexican, Hong Kong and Chinese regulators," a second extruder source said.
Aluminicaste president and chief executive officer Z.P. Liu also is president and chief executive officer of China Zhongwang Holdings Ltd., the second-largest industrial aluminum extrusion product developer and manufacturer in the world.
Zhongwang and several U.S.-based business partners of Liu did not respond to requests for comment regarding the stockpile.