SHANGHAI, May 10 (SMM) – Rumor has been circulating since last Friday that Shandong issued a notice on Implementation Program for Illegal Aluminum Project Crackdown Special Action.
Illegal aluminum capacity in China is concentrated in Shandong, Xinjiang and Inner Mongolia.
Currently, aluminum capacity already built in Shandong totals 11.9 million tonnes, of which 11.5 million tonnes are in operation. It is estimated that some 2-5 million tonnes of existing aluminum capacity in the province are illegal. This makes Shandong one of the main targets in supply side reform.
With supply side reform under way, release of aluminum capacity will be restricted significantly after mid and late June. It is expected that aluminum production will be controlled in the second half of the year due to winter heating season. As such, aluminum price outlook might be more positive in H2 2017.
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