Supply and Demand and Flooding the Market with Aluminum…

As noted by the Times, a tariff fight is on over the flooding of the market with Aluminum by China. Why am I writing about this you ask? Simply put, when countries like China (and Russia before it) flood the market with virgin Aluminum, they lower the value of recycled aluminum in an artificial manner.

Recycled AluminumThis in turn makes it harder for the recycling industry to maintain its programs since it does not have the ability to charge rates that reflect the real cost of that Aluminum. Raw product is highly polluting to manufacture. It uses 95% more energy than recycled product…but, when government can artificially deflate the price by subsidizing and flooding the market, all sides lose.

I am not a big fan in interfering with global markets, but in cases like this, I think that such actions should be blocked.

Read the full article:
Union Seeks Higher Tariffs on U.S. Imports of Raw Aluminum
Limited free access; NY Times subscription may be required.

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One comment

  1. Jeffrey grant says:

    Elect Donald trump, he unlike Clinton wants tariffs imposed for gaming the free trade system. Trump is your man, you just don’t know it yet!

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