US Detains Chinese Aluminum, a Suspected Product of Forced Labor

  • In Business
  • 2023-02-02 08:29:13Z
  • By Bloomberg

(Bloomberg) -- The US is beginning to detain imports of aluminum products suspected of being made through forced labor, particularly from China's Xinjiang region, according to one of the world's biggest shipping firms.

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US Customs and Border Protection has begun issuing "detention notices" for such products, AP Moller-Maersk A/S said Tuesday on its website, adding that the action will most likely target aluminum used in automotive parts.

Allegations by the US and other countries of forced labor in Xinjiang, which Beijing has denied, are among a constellation of frictions between the world's two biggest economies that increasingly see each other as their top strategic competitor.

The CBP wasn't immediately able to respond to a request for comment.

When asked about the issue at a regular press briefing in Beijing, China's Foreign Ministry spokeswoman Mao Ning said the US was politicizing trade issues and destabilizing supply chains "with the excuse of a non-existing genocide in Xinjiang."

China would take measures to defend the legitimate and lawful rights and interests of Chinese companies, she added.

Read more: BMW, Volkswagen Face Scrutiny Over Supply Chain Ties to Xinjiang

Aluminum, and items made from the metal, now join cotton, tomatoes and polysilicon, in coming under scrutiny over links to the region, officially known as Xinjiang Uyghur Autonomous Region. The CBP in late December or early January began issuing detention notices naming aluminum as a fourth product, according to law firm Miller & Chevalier.

Source Checks

The enforcement falls under the Uyghur Forced Labor Prevention Act, which was signed by President Joe Biden in late 2021. Under the law, companies will have to document that goods sourced from or produced in Xinjiang aren't made using forced labor.

"Companies importing aluminum products, or commodities with aluminum components, should be proactive in ensuring compliance with the UFLPA," Maersk said in the advisory. "This may include conducting due diligence on their supply chain and implementing compliance programs."

Read more: U.S. Crackdown on Forced China Labor Risks Supply Chains Snarls

Xinjiang Joinworld Co., a Chinese producer of aluminum foil with operations in the region, said it was not aware of the development and declined to comment further.

Calls to East Hope Group Co. were not answered, and neither was an email to Tianshan Aluminum Group Co. Both companies operate aluminum smelters in the far-western province.

Small Volume

The impact on America's aluminum markets will likely be small. The US imports virtually no primary aluminum from China, and less than 24,000 metric tons of value-added products per month, according to US trade data.

Aluminum on the London Metal Exchange ended Wednesday down 0.5% and fell 0.1% on Thursday. Despite the lack of immediate market impact, physical traders said they're seeking clarity on what the customs authorities are looking at.

--With assistance from Justin Sink, Colum Murphy and Winnie Zhu.

(Updates with Chinese foreign ministry comment from fifth paragraph and enquiries to Chinese companies from 10th paragraph.)

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