Who knew? Aluminum stashed in Mexico? Recently, an executive of an American company had a hunch that Chinese aluminum was coming into the US through the backdoor. He flew a small aircraft over an industrial park in Mexico and, lo and behold, discovered a cache of aluminum product sitting alongside a manufacturing facility. Some of the cache was covered in hay bales to disguise its appearance. Hmmmm. What's going on here?
Seems that China's largest aluminum maker was flooding the US market by first sending the metal to Mexico. After a brief stopover, it was then forwarded to the US market: a bigger, more lucrative market. Was this a trade violation? Of course, and it underscores the continuing problems of doing business with China's companies and its government. Both seem to have a different take on 1) ethics, 2) legal agreements, 3) business in general, and 4) the US Dept. of Justice., 5) the US Executive Branch of government.
80% of the US Aluminum smelters have closed in the last 15 years. Thousands of jobs have gone away. Where are they? Why, in China, of course. Despite attempts to restrain the dumping tactics of Chinese businesses(supported by Beijing policies), the US has been slow to address the issue at sufficient levels to put an end to this method of gaining market share. This tactic is nothing new: monopolies are created by various tactics and policies to drive out the competition. It works! Look at the success of WalMart and Home Depot: 2 US companies that devastated small businesses across the US as the big box stores stole market share by entering regional and local markets and underselling all the "inefficient" locals.
Globalization is really a substitute for monopolization. Ask President Xi about aluminum.
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