US aluminium foil producers have accused their Chinese competitors of systematically trying to force them out of the business, arguing before a US trade panel that they need anti-dumping duties to survive and invest.
At a hearing before the US International Trade Commission last week, aluminium industry executives argued that preliminary anti-dumping and anti-subsidy duties against Chinese foil should be locked in place to allow an industry "devastated" by unfairly low prices to regain its footing.
"We cannot continue to reduce prices on our product offerings and remain sustainable," said Beatriz Landa, general manager of specialty products at Atlanta-based Novelis Corp.
Chinese producers and some of their customers have argued at the hearing that US foil producers were not being injured and that US producers were incapable of producing the thinnest gauges of foil used in food and medical products packaging. They also said US producers were ceding the market to invest instead in higher-margin aluminium products such as those used in automotive production.
"Our success is not based on selling aluminium foil at low prices," said Mo Xinda, a director at China's Non-Ferrous Metals Industry Association.
Mo said the industry's development in China was geared mainly for China's domestic needs and that some US customers "require china's aluminium foil because US mills cannot satisfy their needs".
The commission is expected to rule on whether US producers were injured by Chinese imports in April, a decision that would uphold or reject Commerce Department's duties.
Around the same time, US president Donald Trump is due to decide whether to impose much broader duties on aluminium imports under a national security investigation.
The foil case, the first the US aluminium industry has brought against China's aluminium sector, could serve as a litmus test for the "Section 232" decision and other aluminium anti-dumping cases aimed at curbing excess Chinese production.
The US Commerce Department in 2017 imposed combined preliminary anti-dumping and anti-subsidy duties on Chinese aluminium foil of about 114 per cent to 243 per cent.
In 2016, imports of aluminium foil from China were valued at an estimated $US389 million ($A500.7 million), Commerce Department figures show.
At Thursday's hearing, US aluminium executives ran through a list of numerous plants that have closed in the past few years as low-priced Chinese imports grew, including a Reynolds Aluminum plant in Richmond, Virginia, with the loss of 725 jobs and a Novelis plant in Louisville, Kentucky.
"We have historically been one of the most cost competitive producers of flat-rolled aluminium products in the world," said Landa, of Novelis. "We cannot compete, however, against products that are subsidized by the Chinese government and that are sold at unfairly low prices," she said.
Lee McCarter, chief executive of JW Aluminum Inc said aluminium foil pricing conditions had deteriorated to a 'turning point" where, without tariff relief, the company also will have to exit the foil business, risking closure of plants in St Louis and Russellville, Arkansas.
"From JW's stand point, If we don't get an affirmative decision, those plants are toast," McCarter said.