【SMM Analysis】Domestic and Overseas Orders Perform Well, Prebaked Anode Production in March 2025 Shows Significant Increase

SMM, April 6:

According to SMM survey and calculations, China's prebaked anode production in March 2025 reached 1.9242 million mt, down 2.93% YoY but up 4.85% MoM. Among this, the production of captive prebaked anode was 873,500 mt, and commercial prebaked anode production was 1.0507 million mt.

In March 2025, the operating conditions of domestic prebaked anode enterprises significantly improved. Some enterprises in Henan and Shandong resumed production smoothly due to the relaxation of environmental protection policies and the commissioning of new capacity. Other enterprises also resumed production after completing maintenance, with a company in Fujian further contributing to the recovery. Although individual enterprises experienced production declines due to maintenance, overall prebaked anode production showed an upward trend. Additionally, March had three more production days than February, leading to a more pronounced increase in production. According to SMM calculations, the industry's operating rate in March reached 76.73%, up 3.55 percentage points MoM, indicating a positive development trend.

Domestic demand: By the end of March, SMM statistics showed that China's existing aluminum capacity was approximately 45.81 million mt, with operating aluminum capacity around 43.88 million mt. The industry's operating rate rose 0.5 percentage points MoM and increased 2.8 percentage points YoY to 95.8%. Currently, aluminum smelters in Sichuan and Chongqing have largely resumed production. A technologically transformed aluminum smelter in Guangxi is expected to resume production around October 2025, while another previously loss-making smelter in Guangxi has already resumed production. Moreover, a capacity replacement and upgrade project at an aluminum smelter in Qinghai has started production, contributing to future growth in operating capacity. Entering April 2025, domestic aluminum operating capacity is expected to rise further as related enterprises reach full production, with annualized operating capacity projected to slightly increase to 43.92 million mt/year by the end of April.

Overseas demand: At the beginning of 2025, prebaked anode export orders performed well, increasing by about one-third compared to the same period last year, particularly for orders to Indonesia and Canada. However, orders to Malaysia saw a significant decline, mainly due to reduced demand after an unexpected incident halted production at a Malaysian aluminum enterprise. According to SMM, export orders in 2025 are generally excellent, driven by new capacity investments and the recovery of some enterprises in the overseas aluminum market. Since Q1, domestic prebaked anode prices have been significantly supported by surging raw material costs, and overseas order prices have also risen accordingly. Based on SMM's current understanding, prebaked anode exports in Q1 2025 are expected to be around 550,000 mt.

Brief Comment: In March 2025, prebaked anode production saw significant growth, benefiting from improved operating conditions in some regions and additional production days compared to February. Currently, prebaked anode enterprises strictly organize production based on orders, and industry supply remains ample. On the demand side, domestic aluminum operating capacity is steadily climbing, and overseas orders in 2025 are highly optimistic, indicating strong demand for prebaked anode in both domestic and overseas markets. In the short term, prebaked anode enterprises are operating steadily, with prices continuing to rise and downstream demand steadily increasing. SMM predicts that prebaked anode enterprises' operating rates are likely to remain high and stable in April. Moving forward, it is essential to closely monitor the operating conditions of prebaked anode and downstream aluminum enterprises to promptly grasp industry dynamics and market trends.