①Mining giant Rio Tinto said on Wednesday that tariffs imposed by the U.S. on its Canadian aluminum have resulted in total costs exceeding $300 million in the first half of the year; ②In March, President Trump imposed a uniform 25% import tariff on steel and aluminum, which was raised to 50% in June.
Mining giant$Rio Tinto (RIO.US)$The company said on Wednesday that tariffs imposed by the U.S. on its Canadian aluminum have resulted in total costs exceeding $300 million in the first half of the year. This is another sign of the ongoing impact of President Trump's trade policies on the metal supply chain.
As the world's second-largest mining company, Rio Tinto is also the largest aluminum producer in Canada, with most of its aluminum sales directed to the U.S. market.
Rio Tinto released its first-half production report on Wednesday, stating that the total cost associated with U.S. aluminum tariffs reached $321 million. However, the company has recouped a significant portion of this through higher sales premiums in the U.S. market.
The metal industry is grappling with the trade storm unleashed by President Trump this year. In March, he imposed a uniform 25% import tariff on steel and aluminum, which was raised to 50% in June.
Aluminum is crucial for most heavy industries and is widely used in various sectors, including cars, electronics, and skyscrapers.
Trump also plans to impose a 50% tariff on copper, a move that has previously caused market panic, and the U.S. is also considering potential measures for other metals.
Rio Tinto noted that after the initial 25% tariff was announced, the premium for Aluminum in the U.S. market (the additional cost on top of the Exchange price) quickly reflected this increase in cost. However, by the end of the second quarter, the impact of the 50% tariff had not yet been fully absorbed.
$Rio Tinto (RIO.US)$In the first half of this year, Rio Tinto exported approximately 720,000 tons of Aluminum to the U.S., accounting for about three-quarters of its Canadian production.
Canada is the largest exporter of Aluminum to the U.S., accounting for 60% of U.S. Aluminum imports. It is also the largest exporter of steel to the U.S., accounting for about 25% of U.S. steel imports.
U.S. Aluminum Futures show that the cost of Aluminum is rising, leading to higher expenditures for U.S. buyers. Industry executives have warned that tariffs could severely impact demand for Aluminum in the U.S.
Contracts related to the premium for Aluminum delivered to the Midwest region have nearly tripled this year, reaching a record high of around 66 cents per pound.
Earlier this month, $Constellation Brands (STZ.US)$stated that it expects the Aluminum tariffs to cost the company an additional $20 million for the remainder of the fiscal year. Constellation Brands is one of the world's largest producers of wine, beer, and spirits.
Editor/Melody