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US Risks Stoking Inflation If Carbon-Linked Tariffs Hit China

  • EU already considering carbon tax on steel and aluminum
  • Chinese aluminum sales hit record after Russian invasion

China’s steel and aluminum exports are under attack once again, as the US and European Union weigh new tariffs linked to carbon emissions.

The idea from President Joe Biden’s administration would probably have the biggest impact on the aluminum market, particularly in the EU, which has relied on Chinese smelters to plug gaps in output following Russia’s invasion of Ukraine. That dependency highlights the inflationary risks of any measures that would shrink supply or add costs based on climate goals.