China is unlikely to relax its tariff policy on the export of raw aluminum, according to United Company RUSAL Plc (00486.HK).
RUSAL chief executive Vladislav Soloviev said China wants to discourage the export of raw aluminum but has reduced tariffs on value-added downstream products of the metal, the Hong Kong Economic Journal reported Monday.
He said such a policy, which is aimed at encouraging the export of value-added aluminum products, remains strong and sustainable.
China currently charges a 15 percent tariff on raw aluminum exports but provides waivers for value-added products.
About 40 percent of Chinese aluminum enterprises are operating inefficiently, while the sector is struggling with an oversupply, Soloviev said.
Still, Soloviev sees rising demand for metal amid a rising trend among vehicle makers to use aluminum instead of steel.
About 35 to 40 percent of RUSAL’s output is being used in the manufacture of cars and other transport vehicles. He expects the proportion to rise to 50 percent.
Soloviev also forecast that the price of aluminum will rebound to US$2,000 per ton by the end of the year, from US$1,801 in the first quarter as quoted in the London Metal Exchange.
Translation by Vey Wong
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