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China June aluminium, steel exports rise as trade row intensifies

Reuters  |  BEIJING 

By Tom and Muyu Xu

(Reuters) - China's aluminium exports exceeded half a million tonnes for only the second time ever in June while exports hit an 11-month high, as strong international prices and a weak yuan meant shipments continued to defy U.S. tariffs.

is the world's top of and aluminium, which have been subject to 25 percent and 10 percent import tariffs, respectively, in the United States, since March 23.

Its ability to keep exports of both metals buoyant even amid these tariffs is likely to frustrate Washington, which imposed the duties to protect and has called on to rein in excess capacity.

Separate customs data on Friday showed China's trade surplus with the swelled to a record in June as exports accelerated, potentially further inflaming a bitter trade row between the world's top two economies.

China's unwrought aluminium and aluminium product exports were 510,000 tonnes last month, worth 9.41 billion yuan ($1.41 billion), customs said..

That was up 10.9 percent from 460,000 tonnes a year ago and topped a revised 480,000 tonnes in May, previously the second-highest figure ever behind only the 542,700 tonnes exported in December 2014.

July exports will remain high because of the weak currency and quiet domestic market, said Paul Adkins,

said anecdotal evidence suggests U.S. companies are still buying aluminium from China - even with the tariffs - because U.S. smelters have not ramped up output.

He noted aluminium prices in the and were strong, whereas they had weakened in China.

"The arbitrage is open, there is available. All the factors are in place for that export trade to continue and obviously it has done," he said.

U.S. sanctions on Russian have "impacted availability" in Europe, "so that's certainly going to be drawing a bit of demand out of China," Shaw added.

Meanwhile, China's product exports for June climbed 1.9 percent year on year to 6.94 million tonnes, their highest since July 2017. They also nudged up from 6.88 million tonnes in May amid higher output in the second quarter and stronger global prices.

Richard Lu, an at in Beijing, noted that the direct trade volume for Chinese to the was "very small," so the March tariffs had only a "limited impact."

On July 10, however, a range of steel and were targeted in another list of tariffs that the United States has threatened to slap on $200 billion worth of goods from China, which has vowed to respond.

($1 = 6.6687 Chinese yuan renminbi)

(Reporting by Tom and Muyu Xu; editing by Richard Pullin)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Fri, July 13 2018. 12:06 IST