SHANGHAI, Feb. 22 (SMM) -- The China Copper & Aluminum Summit will be held during March 21-23, and participants are more concerned about copper and aluminum price trends and downstream consumption, since price and downstream consumption trends are the lifeline of enterprises, especially when aluminum prices are much lower than cost prices.
A head of Zhuhai Hongfan Non-ferrous Metals Chemical Industry Co., Ltd. said the company is operating at a loss. In the absence of self-owned power plant, the company’s electricity prices have reached RMB 0.63/kwh after the National Development and Reform Commission raised electricity prices twice in 2011. According to SMM estimates, average composite costs at China’s aluminum smelters have reached RMB 16,700/mt, creating a loss of at least RMB 800/mt for aluminum smelters.
China’s aluminum capacity is in surplus currently, and spot aluminum inventories are high, with domestic aluminum inventories in Shanghai, Wuxi, Hangzhou and Nanhai reaching 867,000 mt according to SMM statistics on February 20. Downstream demand is far from improving, allowing the head to be pessimistic toward aluminum outlook. However, he revealed that the company will not cut production, since large amounts of funds will be needed for the maintenance of equipment after production cuts.
The situation of China aluminum smelters has been very bad, and he believes aluminum prices will not fall further and will instead fluctuate between RMB 15,900-16,300/mt in the short term if no major negative news is reported. In addition, he believes there is no hope of actual improvement in aluminum prices in 1H 2012.
Agenda (Copper Industry Chain Forum) >
Agenda (Aluminum Industry Chain Forum) >
Contact: Contact: Katherine Tel: +86-21-5155 0306
Mobile: +86-139-1653-9227 Email：email@example.com