SHANGHAI, Oct. 22 (SMM) – SHFE aluminum have recorded an 8-day losing streak, and spot prices in China’s domestic market also keep falling. What caused the fall and where will prices head?
The slump all boils down to lower costs – driven by lower power tariffs and coal prices, and aluminum prices are nowhere near the bottom, SMM pointed out.
On-grid power tariffs in west Inner Mongolia have fallen to 0.1184 yuan/Kwh for industrial power users since October 1 after pilot power tariff reform there. The pilot program will cover more regions in the future, which will enable more aluminum smelters to enjoy lower power costs, which take up nearly 40% of total costs.
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