Aluminum enterprises are worried about the shift of Chinese aluminum

VCN - Domestic aluminum enterprises are facing many challenges such as overcapacity, the impending expiration of the anti-dumping duties; and especially the trend of shifting production investment capital flows of Chinese enterprises.
Australia ends anti-dumping tax on aluminum extrusions imported from Vietnam Australia ends anti-dumping tax on aluminum extrusions imported from Vietnam
Ministry reviews anti-dumping measure imposed on Chinese aluminum Ministry reviews anti-dumping measure imposed on Chinese aluminum
A company prosecuted for illegally exporting aluminum ingots A company prosecuted for illegally exporting aluminum ingots
Aluminum enterprises are worried about the shift of Chinese aluminum
Vietnam aluminum industry forum - 2023. Photo: N.Linh

Lack of aluminum smelting capacity

Those are the three challenges that domestic aluminum enterprises have to face. This issue was raised at the Vietnam aluminum industry forum 2023 that took place on May 17, organized by the Vietnam Association of Aluminum (VAA) in collaboration with the Private Economic Development Research Board (Board IV).

Vu Van Phu, Vice President and General Secretary of the VAA, said that Vietnam located in the Asia-Pacific region, represents the largest market and is also expected to be the fastest-growing market in the next five years due to increasing consumption from China, India, and Japan. It is forecast that the growth rate of Vietnam's aluminum industry in 2023 would reach 7%.

The main products of Vietnam's aluminum industry are Ingot aluminum, aluminum billet, profiles aluminum, and industrial aluminum. Profiles aluminum is expected to dominate the market with the driving force being the construction industry.

Besides, Vietnam is the 4th growth construction market in Asia, with big targets in infrastructure and housing, this is the driving force for the development of the aluminum industry in the next period.

However, Vietnam currently does not have the ability to smelt aluminum; aluminum businesses are completely dependent on imported aluminum and scrap to produce aluminum products.

Facing the threat of trade remedies

Besides opportunities, the aluminum industry is facing many challenges, especially overcapacity. Currently, there are about 100 aluminum factories mainly producing profiles aluminum. Aluminum production capacity increased sharply, about more than 1.2 million tons/year, fully meeting domestic and export demand.

However, in recent years, the capacity of the aluminum industry has started to be redundant. Output only reaches 70% of the designed capacity, and the quantity of goods has far exceeded the demand of domestic and export markets.

"In the first quarter, factories only operated at 30-40% of capacity, mainly maintaining jobs for workers, low revenue, and difficult cash flow," said Phu.

Meanwhile, according to Phu, aluminum imported from China is accounting for a large proportion of the domestic market. Importing aluminum from China at low prices has affected domestic aluminum production, causing fierce competition in Vietnam.

To protect domestic aluminum production from unfair competition from imported products, Vietnam has imposed anti-dumping duties on Chinese aluminum since 2019 with a temporary tax rate from 2.49% to 35.58%, valid for five years. However, this decision will expire in October 2024, the deadline for submitting the final review dossier is September 2023.

Therefore, according to the VAA, manufacturers need to recognize the role of anti-dumping tax on the domestic market in recent years to make recommendations related to the extension of the decision on the imposition of anti-dumping tax.

In particular, the VAA also raised the current challenge, which is the trend of shifting direct investment capital to Vietnam in recent years, mainly from Chinese aluminum manufacturers. Typically, the Guangdong Xingfa Company redirecting production investment in Vietnam.

According to the VAA, in 2016-2018, Chinese aluminum had an excess of production, spilled into dumping, causing domestic aluminum enterprises to cease operations and workers to lose their jobs. In 2019, when the Ministry of Industry and Trade imposed anti-dumping duties on profiles of aluminum originating from China, along with the intervention of anti-smuggling and trade fraud agencies, Chinese aluminum has been prevented from being dumped into Vietnam.

The problem is that after being imposed tariffs, Chinese manufacturers have redirected their direct investment to Vietnam to avoid tax imposition. Simultaneously, the relocation of production bases can help Chinese aluminum take advantage of tariff preferences from trade agreements that Vietnamese aluminum is currently avoiding trade remedies of countries such as the US, the EU, and the UK. This will directly affect the domestic and export market of Vietnamese aluminum factories.

Therefore, the VAA said that their members once again faced the risk of losing the domestic market for the second time like in 2018-2019 before the anti-dumping tax was imposed; and faced the risk of being investigated and imposed tariffs to evade trade remedies when export aluminum to the EU and the US.

By Ngoc Linh/ Ha Thanh

Related News

Review and handle safeguarding and anti-dumping duties

Review and handle safeguarding and anti-dumping duties

VCN – To ensure the application of collection and payment of safeguarding duties and anti-dumping duties in accordance with regulations, the General Department of Vietnam Customs requested HCM City Customs Department to review safeguarding duties and anti-dumping duties specified in the decisions of the Ministry of Industry and Trade, which is mentioned in Official Dispatch No. 261/TCHQ-TXNK dated January 21, 2022.
Ministry reviews anti-dumping measure imposed on Chinese aluminum

Ministry reviews anti-dumping measure imposed on Chinese aluminum

Thenbsp;Ministry of Industry and Tradenbsp;(MoIT) has announced the second review of anti-dumping measures imposed on some aluminum productsnbsp;from China.
Vietnam to impose anti-dumping duties on Malaysia’s H-beams

Vietnam to impose anti-dumping duties on Malaysia’s H-beams

Certain H-beam steel products imported from Malaysia will be subject to anti-dumping duties in Vietnam, according to a recently-issued decision from the Ministry of Industry and Trade.

Latest News

VN

VN's food processing industry struggles to improve quality and value chain integration

Despite accounting for 19.1 per cent of Việt Nam’s processing sector, the food processing industry has been struggling with major issues such as poor-quality raw materials and subpar value chain integration, said industry insiders and economists.
Approach strategy of the seafood industry when implementing UKVFTA

Approach strategy of the seafood industry when implementing UKVFTA

VCN - As one of Vietnam's strong export industries to the UK, especially when the Vietnam - United Kingdom of Great Britain and Northern Ireland Free Trade Agreement (UKVFTA) comes into effect, with a detailed information approach strategy, it has created a great driving force to promote the export of Vietnamese seafood products to this market.
Mid-November: Vietnam

Mid-November: Vietnam's trade volume matches 2023 total, eyes record-breaking growth

VCN - By mid-November 2024, Vietnam's total import-export turnover reached an impressive US$681.48 billion, equaling the full-year trade figure for 2023
Vietnamese enterprises facing challenges from cross-border e-commerce platforms

Vietnamese enterprises facing challenges from cross-border e-commerce platforms

VCN – In recent years, with the rapid development of cross-border e-commerce (CBEC) platforms, domestic enterprises in Vietnam have been facing numerous difficulties and challenges.

More News

Vietnam, Malaysia eye new milestone in trade ties

Vietnam, Malaysia eye new milestone in trade ties

The official visit to Malaysia from November 21-23 by Party General Secretary To Lam is expected to open up new opportunities for and mark a new milestone in the economic and trade cooperation between Vietnam and Malaysia. Vietnam and Malaysia are key economic, trade, and investment partners. Their economic and trade ties have steadily grown since the two nations established diplomatic relations in 1973.
Shrimp exports surge in 10 months, generating 3.2 billion USD

Shrimp exports surge in 10 months, generating 3.2 billion USD

Vietnam’s shrimp exports in October reached US$394 million, a strong 24% increase year-on-year, according to the Vietnam Association of Seafood Exporters and Producers (VASEP).
Vietnam’s exports to the U.S. near US$100 billion milestone

Vietnam’s exports to the U.S. near US$100 billion milestone

VCN - By the end of October, Vietnam's exports to the United States approached US$100 billion, reaffirming its position as Vietnam's largest export market.
From the “abnormal” coffee price, worries about the new crop

From the “abnormal” coffee price, worries about the new crop

VCN - The Vietnamese coffee industry enters the new crop with the question of what is a reasonable price to ensure benefits for coffee growers while still retaining international consumers.
What obstacles limit the market share of Vietnamese goods in the UK?

What obstacles limit the market share of Vietnamese goods in the UK?

VCN - Vietnamese goods account for only about 1% of total imports into the UK market. One of the reasons is that they have not yet built their own brands and have not focused on effective strategies and approaches to market information.
Why seafood exports to some Middle Eastern Countries are stalled

Why seafood exports to some Middle Eastern Countries are stalled

VCN - Several shipments of seafood exported to certain Middle Eastern countries have been delayed due to legal challenges related to consular legalization procedures. This has created significant bottlenecks in accessing these markets.
Storm No. 3 destroys profits of many insurance companies

Storm No. 3 destroys profits of many insurance companies

VCN - Due to the impact of storm No. 3, the business results of the third quarter and the first 9 months of 2024 of the insurance sector have been significantly affected. This requires more efforts from businesses for the results of the whole year 2024.
Vietnam, Malaysia eye golden partnership opportunities in Halal industry

Vietnam, Malaysia eye golden partnership opportunities in Halal industry

Cooperation in the Halal industry can help Vietnamese products reach nearly 2 billion Muslim consumers worldwide, representing over 24% of the global population, according to Malaysia’s Minister of Investment, Trade, and Industry Zafrul Abdul Aziz.
Tra fish sector aiming for production, processing greening for sustainable development

Tra fish sector aiming for production, processing greening for sustainable development

Greening production and processing to meet export requirements is both a trend and a necessity for many industries, including the tra fish sector.
Read More

Your care

Latest Most read
VN

VN's food processing industry struggles to improve quality and value chain integration

Despite accounting for 19.1 per cent of Việt Nam’s processing sector, the food processing industry has been struggling with major issues such as poor-quality raw materials and subpar value chain integration, said industry insiders and economists.
Approach strategy of the seafood industry when implementing UKVFTA

Approach strategy of the seafood industry when implementing UKVFTA

VCN - Mr. Nguyen Hoai Nam, Deputy General Secretary, Vietnam Association of Seafood Exporters and Producers (VASEP), said that the advantage that UKVFTA brings is that the main products of the seafood industry enjoy 0% import tax to the UK, especially key
Mid-November: Vietnam

Mid-November: Vietnam's trade volume matches 2023 total, eyes record-breaking growth

By mid-November 2024, Vietnam's total import-export turnover reached an impressive US$681.48 billion, equaling the full-year trade figure for 2023
Vietnamese enterprises facing challenges from cross-border e-commerce platforms

Vietnamese enterprises facing challenges from cross-border e-commerce platforms

VCN - E-commerce platforms have emerged as crucial distribution channels, enabling goods to reach consumers quickly and conveniently.
Vietnam, Malaysia eye new milestone in trade ties

Vietnam, Malaysia eye new milestone in trade ties

The official visit to Malaysia from November 21-23 by Party General Secretary To Lam is expected to open up new opportunities for and mark a new milestone in the economic and trade cooperation between Vietnam and Malaysia. Vietnam and Malaysia are key economic, trade, and investment partners. Their economic and trade ties have steadily grown since the two nations established diplomatic relations in 1973.
Mobile Version