Network Metals LLC

Chinese smelters are restarting 700,000 tons of aluminum capacity in response to high prices for domestically-produced aluminum, which are significantly higher than global prices. This is exactly what we have been on about for the last couple of months – it proves that you can’t judge the global aluminum market, or really any metals market, without considering the entirely separate level the Chinese are playing on. Through export rebates and energy subsidies, the Chinese are creating an uneven playing field for their domestic producers, to create as many domestic jobs as possible. The situation is comparing apples to oranges. It is not possible to get an accurate reading of global supply and demand when the Chinese will simply adjust their tax and cost policies to suit their producers.

It is also an insight that only comes from dealing directly with Chinese consumers and producers, as we do. With this in mind, it is our position that the only people this move really helps out in the long run are alumina producers.