BEIJING: The recent rise in China’s aluminum exports has had a limited impact on the Asia market to date due to the moves that participants made to protect their businesses after a similar surge in 2015, market sources said Friday. London Metal Exchange aluminum prices traded higher than Shanghai Futures levels in December, prompting Chinese plants to export aggressively over the past two months. A similar situation emerged in the first half of 2015, which significantly impacted the Asia market. This time, few market participants in Asia are feeling the direct impact of the increase Chinese exports, as they are able to compete more effectively, trade and producer sources said. S&P Global Platts surveyed two producers and five trading firms this week on the impact of China’s increase in exports. Two producers and two traders said they had not been impacted at all. These producers have annual contracts with customers in Vietnam, Thailand and the rest of Asia.
One trader said he had deliberately focused in the three years since China’s last export hike on developing business relationships with Asian consumers that have specific raw material requirements and had less flexibility in switching suppliers.A second trader said he had also shifted his focus away from supplying buyers who could be tempted to switch to cheaper Chinese material. “Chinese exports will always have an impact, but that does not bother us,” the second trader added.
