Weekly Review Of Chinese Aluminium Market Fundamentals

SHANGHAI, May 15 (SMM) - One prebaked anode producer has received a small amount of orders from an aluminium smelter in Yunnan for delivery in June. Judging from power supply in Yunnan, a small amount of aluminium capacity in the province may be able to resume at the end of June or early July. Some aluminium smelters in Guizhou are still proceeding with production resumption. It is expected that the domestic operating aluminium capacity will exceed 40.9 million mt by the end of May. In terms of cost, the average price of SMM prebaked anodes plunged 868 yuan/mt month-on-month in May, and the power cost of smelters with captive power plants also declined. The operating rates of aluminium wire & cable and secondary aluminium alloy sectors have basically recovered to levels seen before the Labour Day holiday, but the growth will not sustain in the aluminium wire & cable sector. In aluminium plate/sheet, strip and foil sectors, poor demand forced a large number of small and medium-sized enterprises to cut or cease production, and even large enterprises lowered their production slightly. On the whole, downstream operating rates will hardly improve in the short term with the gradual arrival of the off-season.