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China's Aluminum Market Will Move Into Surplus In 2013 -CICC
Oct 27,2011 09:03CST
industry news
Source:SMM
The Chinese aluminum market will move into surplus in 2013 as new smelters in the country's western provinces come on stream.

SINGAPORE, Oct 26, 2011 (Dow Jones) -- The Chinese aluminum market will move into surplus in 2013 as new smelters in the country's western provinces come on stream, Janet Kong, managing director of China International Capital Corp., said Wednesday.

China will see a deficit of around 500,000 metric tons in 2011 and another deficit in 2012, after which the market will swing back into a moderate surplus "for the foreseeable future" from 2013, Kong told delegates at Metal Bulletin's Asian Bauxite and Alumina Conference Wednesday.

The country's western provinces, which enjoy lower energy costs and policy support from the government, will account for 75% of aluminum capacity additions between 2011 and 2015, she said.

Production growth so far this year has reached 13.7% in the western provinces compared with 2.4% for the rest of China, Kong said.

While production in the western provinces will outstrip the rest of the country, the rate of supply growth in the world's second-largest economy is slowing, she said.

Kong forecast a 7% compound annual growth rate for the years up to 2015 compared with production growth of 17% a year in the last five years.

The rate of Chinese consumption will also slow, although demand will remain robust. "In our view, consumption will remain healthy, but not as strong as the last few years," she said.

The global aluminum market was 552,700 tons in surplus in the first eight months of this year, the World Bureau of Metal Statistics said.

China was a net exporter of unwrought aluminum in this period, with exports exceeding imports by 290,000 tons.

Chinese aluminum output was 11.877 million tons in the January-August period, accounting for 41% of total world production, WBMS estimates showed.
 

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