Waste aluminum processing trade tax policy will resume

“According to our understanding, in the forthcoming Catalogue of Prohibited Commodities for Processing Trade, the Ministry of Commerce will not include recycled aluminum. In addition, according to related departments, the taxation policy for the processing of scrap aluminum will soon return to 2006. The status before July 1st of this year.” This is the information disclosed by Ma Hongchang, Deputy Secretary-General of China Nonferrous Metals Industry Association Recycling Metals Branch, at the 3rd China Copper Conference and the 4th China Aluminum Conference recently held.
This is undoubtedly a great advantage for the renewable aluminum industry in the “fluctuating development”. As recycled aluminum and electrolytic aluminum belong to the same tariff number, in the process of the “two high and one capital” type of commodities that the country launched this year, recycled aluminum products are repeatedly implicated in relevant policies. As a sunrise industry, recycled aluminum is supposed to be supported by the state, but due to the influence of the electrolytic aluminum industry, it has repeatedly suffered from the challenge.
In spite of this, China's recycled aluminum industry as a whole has maintained a rapid development. Ma Hongchang expects that China's recycled aluminum production capacity will reach 2.3 million tons in 2006.
However, China’s imported aluminum scrap fell for five consecutive months this year. Customs statistics show that in the first eight months, China imported 1,070,000 tons of aluminum scrap, a decrease of 0.54% year-on-year. Li Hongwei, assistant general manager of Shanghai Xinge Metals Co., Ltd., the largest secondary aluminum alloy factory in China, said that this was mainly due to the fact that prices of domestic scrap and primary aluminum continued to fall below the international market this year. In addition, the “two out” processing trade modes of imported aluminum scrap and export recycled aluminum alloy can reduce the losses caused by domestic and foreign price spreads, and the amount of imported scrap aluminum in processing trade has increased.
As an important area of ​​circular economy, the development of recycled metals has attracted much attention. The National Development and Reform Commission has set a target of 35%, 25%, and 30% of the total amount of recycled copper, aluminum, and lead in the "Eleventh Five-Year Plan" for the nonferrous metals industry.
In order to encourage and support the development of the recycled metal industry, in 2006 the National Development and Reform Commission continued to set up a special fund for national debt of circular economy demonstration projects.
Ma Hongchang disclosed that since the beginning of this year, there have been 13 projects in the recycling metal industry that have participated in the review. Most of the projects will be approved, and nearly 100 million yuan of treasury bonds will be supported.
According to research and analysis conducted by the Recycling Metals Branch, in the first three quarters of 2006, China’s total output of regenerated non-ferrous metals reached 3.41 million tons, including 1.26 million tons of recycled copper, 1.76 million tons of recycled aluminum, 300,000 tons of recycled lead, and 90,000 tons of recycled zinc. Compared with the same period in 2005, they rose by 19%, 21%, 42% and 38% respectively. Ma Hongchang predicts that the output of recycled metal will reach 4.5 million tons this year, an increase of 20% from 2005.