China Aluminum Exports Highest Since 2011 on Overseas Premium

Apr 10, 2014 3:03 am ET

April 10 (Bloomberg) -- Aluminum exports from China, the world’s largest producer and user, rose to the highest level last month in more than two years as traders shipped the metal overseas for higher returns amid a record premium.

Exports of unwrought aluminum and aluminum products were 370,000 metric tons in March, customs data showed today. That was the highest since 390,000 tons in July 2011 and more than doubled the figure in February.

Premiums that are added to the London Metal Exchange aluminum price to secure delivery reached a record in Europe and the U.S. in the first two months of 2014, and they’re at an all- time high in Japan, Harbor Intelligence, a researcher based in Austin, Texas, said in a report last month.

“Exports rose as traders pursued profits from arbitrage with higher overseas premiums,” said Wang Chunhui, an analyst in Shanghai at SMM Information & Technology Co.

The contract for delivery in three months on the LME rose 0.9 percent to $1,873.75 a ton at 3:01 p.m. in Shanghai and has climbed 4.1 percent this year. The metal on the Shanghai Futures Exchange gained 0.8 percent to close at 13,160 yuan ($2,120) a ton. China imposes a 15 percent export tax on primary aluminum and offers tax rebate on exports of some aluminum products.

China also imported 420,000 tons of unwrought copper and copper products in March, customs said today. That compared with 380,000 tons in February and was the highest since a record in January.

Copper imports rose because of deliveries from long-term supply contracts and demand for using the metal as collateral in financing agreements, said Li Ye, an analyst at Shenyin & Wanguo Futures Co. in Shanghai.

Iron ore imports by China rose to 73.96 million tons in March, compared with 61.24 million tons in February, according to customs. That was the highest level since a record in January.