In January, during the Chinese New Year holiday, the casting ingot output of aluminum plants across various regions increased [SMM Data].

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SMM  January 24: According to SMM statistics, China's aluminum production in January 2025 (31 days) was up 3.8% YoY but down 0.3% MoM. The operating capacity of domestic aluminum smelters in January remained largely stable MoM, with only a few smelters in Shanxi reporting production cuts of 20,000 mt/year. Other previously reduced capacities have not resumed production. During the month, the proportion of casting ingots increased in multiple regions, while the proportion of liquid aluminum decreased by 2.9 percentage points MoM and 1.0 percentage point YoY. Based on SMM's data on the proportion of liquid aluminum, the casting ingot production in December increased by 7.3% YoY to approximately 1.13 million mt.  

Capacity Changes: As of the end of January, SMM statistics show that the existing capacity of domestic aluminum smelters was approximately 45.71 million mt, while the operating capacity was around 43.51 million mt. The industry's operating rate decreased by 0.04 percentage points MoM but increased by 2.29 percentage points YoY to 95.2%. Currently, the operating capacity of domestic aluminum smelters remains largely stable, with only a few smelters in Shanxi cutting production by 20,000 mt/year due to technological transformation. The production capacities reduced in Sichuan and Chongqing in December due to losses have not yet resumed production. SMM will continue to monitor subsequent developments.

Production Forecast: Moving into February 2025, the operating capacity of domestic aluminum smelters is expected to remain stable, with no production resumption plans for previously reduced capacities. By the end of February, the annualized operating capacity of domestic aluminum smelters is expected to remain at 43.51 million mt/year. February coincides with the Chinese New Year holiday, leading to weaker downstream demand and production cuts at some billet and alloy plants. The proportion of liquid aluminum is expected to further decrease to around 68% in February. Continued attention is needed on capacity changes in various regions and the operating conditions of downstream sectors such as aluminum billets.

Data Source: SMM

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