US Customs agents seize aluminum shipments

Agents working for the U.S. Customs agency have reportedly seized shipping containers filled with finished or semifinished aluminum valued at up to $25 million at the Port of Long Beach, California. According to an online report by the Wall Street Journal, the aluminum is related to an investigation of the owner of China Zhongwang Holdings Ltd., an aluminum producer in that nation.

In late August 2016, a U.S.-based subsidiary of Zhongwang announced it had agreed to purchase Cleveland-based aluminum producer Aleris Corp. Aleris focuses on rolled aluminum products and operates 14 facilities, with the majority in North America but others in Europe and China.

In the fall of 2016, the Wall Street Journal reported that China Zhongwang, through a series of related companies, was storing considerable amounts of finished aluminum, as much as 6 percent of the global supply, at a remote location in Mexico. According to the article, the move was seen by some observers as an effort to avoid U.S. tariffs on aluminum imports from China.

Other media reports have accused companies with ties to Zhongwang of storing aluminum in Vietnam and also in New Jersey at a location in the Philadelphia area. The New Jersey allegation caused the U.S. Department of Commerce to open an investigation to determine whether the company has been repositioning and possibly mislabeling aluminum to avoid tariffs, according to one media report.

According to the January 2017 Wall Street Journal article, the shipping containers in Long Beach were seized from a firm called Perfectus Aluminum Inc., which was founded by the son of Zhongwang Holdings CEO Liu Zhongtian and is now operated by a friend of his. Perfectus Aluminum has objected to the earlier detention of the containers and is seeking legal relief and has asserted its right to have possession of the metal.