Chinese Aluminum Smelters Register Decent Profits in 2016 on Surging Prices, SMM Reports-Shanghai Metals Market

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Chinese Aluminum Smelters Register Decent Profits in 2016 on Surging Prices, SMM Reports

SMM Insight 09:58:26AM Mar 03, 2017 Source:SMM

SHANGHAI, Mar. 3 (SMM) – With aluminum prices bouncing back, Chinese aluminum smelters reported decent profits in 2016. According to financial reports by major listed aluminum companies, net profits at the five major producers surged in 2016 on a yearly basis, and Yunnan Aluminum topped the list, with details in table below.

China Aluminum Inventories Grow for 9 Weeks, and Rio Tinto to Cut Output 14 percent at Australian Aluminum Smelter

Company

Net Profits Attributable to Shareholders in 2016

YoY Change

Yunnan Aluminum

122 million yuan

up 315%

Jiaozuo Wanfang Aluminum Manufacturing

75 -110 million yuan

up 219.96%-275.94%

Nanshan Aluminum

1,270 million yuan

up 127 %

Henan Zhongfu Industry

55-75 million yuan

up 112.62%-117.21%

CHALCO

380 million yuan

up 85%

Source: financial reports

In 2016, production costs at domestic aluminum smelters grew with rising prices of alumina, coke and transportation fees. But, surging aluminum prices helped improve their profits.

According to SMM data, the average profit at domestic aluminum producers was 1,000 yuan per tonne in 2016, with the peak level of around 2,500 yuan per tonne. At present, the average profit is about 450 yuan per tonne. 

China's aluminum smelting industry climate index rose from 19.71 in January 2016 to 47.16 in January 2017, according to China Nonferrous Metals Industry Association, a sign of big improvement in business profits in the whole industry.

In 2016, profits at domestic aluminum smelting industry amounted to 22.6 billion yuan, and the proportion of smelters in losses fell to 18.5 percent, down 11.2 percentage points on a yearly basis. The average aluminum spot price in China’s domestic market was 12,797 yuan per tonne in September 2016, the best time of price in the year, while full costs at domestic aluminum producers were around 11,500 yuan per tonne, and at that time, the proportion in losses only accounted for 1.7%.

The increase in profits grew market investment enthusiasm. The fixed-asset investment in domestic aluminum smelting industry, which dropped for three years in a row from 2013 to 2015, rallied finally in 2016, with YTD completed investment reaching 57.3 billion yuan, up 2.81% YoY.

Domestic aluminum smelters also turned active in restarting offline capacities or expanding new capacities. SMM data show the number of capacities being commissioned among all restarted or newly-increased ones reached 3.95 million tonnes in 2016, and the number is expected to grow further in 2017.

For news cooperation, please contact us by email: sallyzhang@smm.cn or service.en@smm.cn.

Chinese Aluminum Smelters Register Decent Profits in 2016 on Surging Prices, SMM Reports

SMM Insight 09:58:26AM Mar 03, 2017 Source:SMM

SHANGHAI, Mar. 3 (SMM) – With aluminum prices bouncing back, Chinese aluminum smelters reported decent profits in 2016. According to financial reports by major listed aluminum companies, net profits at the five major producers surged in 2016 on a yearly basis, and Yunnan Aluminum topped the list, with details in table below.

China Aluminum Inventories Grow for 9 Weeks, and Rio Tinto to Cut Output 14 percent at Australian Aluminum Smelter

Company

Net Profits Attributable to Shareholders in 2016

YoY Change

Yunnan Aluminum

122 million yuan

up 315%

Jiaozuo Wanfang Aluminum Manufacturing

75 -110 million yuan

up 219.96%-275.94%

Nanshan Aluminum

1,270 million yuan

up 127 %

Henan Zhongfu Industry

55-75 million yuan

up 112.62%-117.21%

CHALCO

380 million yuan

up 85%

Source: financial reports

In 2016, production costs at domestic aluminum smelters grew with rising prices of alumina, coke and transportation fees. But, surging aluminum prices helped improve their profits.

According to SMM data, the average profit at domestic aluminum producers was 1,000 yuan per tonne in 2016, with the peak level of around 2,500 yuan per tonne. At present, the average profit is about 450 yuan per tonne. 

China's aluminum smelting industry climate index rose from 19.71 in January 2016 to 47.16 in January 2017, according to China Nonferrous Metals Industry Association, a sign of big improvement in business profits in the whole industry.

In 2016, profits at domestic aluminum smelting industry amounted to 22.6 billion yuan, and the proportion of smelters in losses fell to 18.5 percent, down 11.2 percentage points on a yearly basis. The average aluminum spot price in China’s domestic market was 12,797 yuan per tonne in September 2016, the best time of price in the year, while full costs at domestic aluminum producers were around 11,500 yuan per tonne, and at that time, the proportion in losses only accounted for 1.7%.

The increase in profits grew market investment enthusiasm. The fixed-asset investment in domestic aluminum smelting industry, which dropped for three years in a row from 2013 to 2015, rallied finally in 2016, with YTD completed investment reaching 57.3 billion yuan, up 2.81% YoY.

Domestic aluminum smelters also turned active in restarting offline capacities or expanding new capacities. SMM data show the number of capacities being commissioned among all restarted or newly-increased ones reached 3.95 million tonnes in 2016, and the number is expected to grow further in 2017.

For news cooperation, please contact us by email: sallyzhang@smm.cn or service.en@smm.cn.