Production of primary aluminium in China rose 13.4 percent in 2017, but due to the capacity control measurements introduced in 2017 production increase is expected to pull back to around 4-6 percent in 2018.
Production of primary aluminium in China rose 13.4 percent in 2017, but due to the capacity control measurements introduced in 2017 production increase is expected to pull back to around 4-6 percent in 2018.
Chinese aluminium production fell by 1.6 percent compared to the third quarter, but rose 5.6 percent compared to the fourth quarter of 2016 Norske Hydro reported. The Chinese government has announced that they will continue with smelter curtailments next winter in order to reduce air pollution in a number of Chinese cities.Beijing has intensified its efforts to decrease smog as health and mental health issues escalate.
China in 2017 ordered steel and aluminum producers in 28 cities to cut output during winter and, outlined plans to curb coal use in the capital and required coal transport by rail in the north.
Shanghai Futures Exchange (SHFE) prices decreased slightly compared to the third quarter, in contrast to the positive LME development during the quarter. The main reason for the decrease was increasing reported stock levels in China, in spite of the Chinese Government’s efforts to reduce the capacity. Arbitrage potential and semis exports increased during the quarter compared to the third quarter.
Compared to fourth quarter of last year, LME stocks are down 1.1 million mt. Chinese reported stocks have increased 0.1 million mt since the third quarter, and 1.3 million mt since the fourth quarter of 2016. Estimated unreported global stocks were stable compared to the third quarter of 2017 but have decreased 0.2 million mt compared to the fourth quarter of 2016.
Source: Norske Hydro (PDF)