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Aluminum Associations Call for Global Forum to Address Excess Capacity

Monday, March 20, 2017
Sandler, Travis & Rosenberg Trade Report

Three associations representing aluminum producers along the whole value chain in the U.S., Europe, and Canada are urging G-20 leaders to create a global forum on aluminum excess capacity at the July 7-8 summit in Hamburg, Germany.

The Aluminum Association, European Aluminium, and Aluminium Association of Canada state in a March 15 letter that China’s state-sponsored support is contributing to an unsustainable structural overcapacity that will impact growth and contribute to heightened instability until it is addressed. The associations contend that the massive increase in production and the excess capacity have put downward pressure on prices, generating significant economic and employment losses and threatening the competitiveness of both upstream and downstream aluminum producers. Chinese manufacturers currently supply 53 percent of all aluminum produced globally and China’s capacity is expected to increase by an additional 24 percent by 2020.

At last year’s G-20 summit, leaders recognized that “excess capacity in steel and other industries is a global issue which requires collective responses” and agreed to create a global forum on steel excess capacity in order to increase information sharing and cooperation. The associations therefore believe this year’s summit should recognize the excess capacity that negatively impacts the competitiveness of the global aluminum industry by creating a global forum on this matter.

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