China Base Metal Output Data in September 2017, SMM Exclusive Data

SHANGHAI, Oct.16 (SMM) – SMM surveys major producers in China’s base metal market every month to get first-hand production data, and the following table shows latest output data for September 2017.

Source: SMM

Unit: 1,000 tonne

Notes: 1. Data in final column (marked with an asterisk) has been revised. 2. NPI output refers to output in Ni content.

Copper Cathode

China’s copper cathode output was 684,500 tonnes in September 2017, up 1.56% MoM and 5.31% YoY, according to SMM data. Output in the first seven months of the year totaled 5.824 million tonnes, up 1.01% YoY.

The output of September keeps rising but failed to reach expectation, mainly because some secondary copper smelting plants get less output increase than anticipation due to green policies. As per a famous plant’s remarks, its anode copper supplier are declining in copper concentrates output due to short supply caused by green policies. Additionally, Chifeng Yuntong and Yantai Guorun Copper did overhaul which affected some output.

As per SMM research, the second-stage update project of 150,000 tonnes technical upgrading capacity of Fuye Copper will released its first batch of finished products in the middle of September. Daye Nonferrous Metals restarted some of its capacity, with improved capacity utilization. Meanwhile SMM revised the estimated capacity of refined project in the fourth quarter from 400,000 tonnes to 300,000 tonnes, mainly because Lingbao city Jinchen Metallurgy Co. delayed its smelting project of 100,000 tonnes to first half of 2018.

As per planned output of each plants, SMM expects China’s copper cathode output to grow 5.21% YoY to 696,500 tonnes in October, and output in the first ten months of the year will rise 1.44% YoY to 6.5205 million tonnes.

Aluminum

SMM sees China’s aluminum output at 2.919 million tonnes in September, up 18.4% year-on-year and 27.403 million tonnes from January to September, up 18.4% year-on-year. Annualized aluminum capacity in operation is 35.515 million tonnes in September. Since September, production limit effect in Shandong and Xinjiang has been enlarged. Also, aluminium plants including Jiaozuo Wanfang and Shanxi Zhaofeng will limit their production during heating season, causing intense supply of Aluminum.

On Oct. 13^th, Shandong Binzhou introduced its production limit policy (2017.11.5-2018.3.15), affecting capacity of 2.53 million tonnes (including 940,000 tonnes affected by previous supply-side reform), which is estimated to reduce production by 1.59 million tonnes. Previously Henan Province introduced its plan, saying its production limited is 550,000 tonnes. Adding that of Shandong Binzhou, the estimated reduced output has reached 2.14 million tonnes, with upcoming green policies to be introduced by Shandong Liaocheng. SMM knows some newly-increased capacity is still in operation or pre-operation process apart from the policies during heating season, including 280,000-tpy project of Inner Mongolia Huayun Phase 2, 400,000-tpy of Guangxi Huayun Phase 1, 500,000-typ of Shanxi Huarun and 500,000-typ of Guizhou Huaren. Besides, the newly-increased capacity of replacement indicator of Xinjiang Qiya, Inner Mogolia Mentai and Inner Mongolia Chuangyuan is expected to be put into operation within the year. Other capacity without green policies will supplement some of the insufficiency during the heating season. SMM predicts the domestic Aluminum output will be 2.973 million tonnes, increasing 6.1% YoY.

Alumina

The country’s alumina output totaled 5.786 million tonnes in September, up 17.0% year-on-year, and the daily average output was 193,000 tonnes, up 0.9% month-on-month, SMM statistics showed. Firstly, Zhonglv Lvzhou in Henan reduced its output due to short supply of ore and green policy being implemented in Jiaozuo City. Shanxi Fusheng Aluminium reduced its output due to ore and natural gas issues. Guangxi Huayin did overhaul without output reduction. Some small enterprises in Shanxi and Henan did overload production because of little trouble caused by ore supply. Calculated above together, Alumina output is increased slightly in September compared with expectation. The estimated output of Alumina in October is 5.988 million tonnes. Despite introduction of green policies of various cities, enterprises have not planned to reduce their production in October since short time needed for output reduction of Alumina (Alumina enterprises in Jiaozuo excepted), hence the estimated output of Alumina in October is not calculated as reduction.

Refined Zinc

China’s refined zinc output was 472,500 tonnes in September, up 5.97% on the month but down 1.27% on a yearly basis, SMM data showed.

Refined zinc production totaled 3.969 million tonnes in the first nine months of the year, a drop of 1.46% year-on-year.

September see an obvious MoM rise of output of smelting plants, mainly because many plants have finished overhaul and recovered production. In September, despite drop in output of Hechi Nanfang, Yuguang Zinc and Shaanxi QinZinc Overhaul, the industry see a recovery of more enterprises with the end of overhaul and maintenance. Thereinto, Chifeng Zhongse, West Mines, Sihuan Zn and Ge and Anhui Tongguan will recover their output after overhaul.

In October, except dropping output of Zhongjin Lingnan due to regular overhaul and Luoping Zinc Power during dry season, others have finished overhaul with estimated increasing output for zinc plants to complete their annual scheduled plan. SMM predicts total output of refined zinc will increase by 10,000 tonnes compared with September.

Primary Lead

China’s primary lead output grew 5.3% MoM and 9.4% YoY to 266,401 tonnes in September. Except that Jiangxi Jinde and Haicheng Chengxin stopped for overhaul during September, others keep stable generally. For October, Inner Mongolia Chifeng Jinyin Lead and Henan Jinli Gold and lead will do regular overhaul in the end of this month, which is estimated to affect output of 20,000 tonnes, with other smelting plants’ stable production. Influenced by continuous short supply of raw lead concentrates, the estimated output of primary lead in October will drop greatly compared with September.

Refined Nickel

China’s refined nickel output was 12,500 tonnes in September.

In September, Jinchuan Group reduced its production by 1,500 tonnes to 10,500 tonnes due to its overhaul ti refined nickel production line. Xinjiang Xinxin’s output slightly dropped by 40 tonnes in September compared with August.

In October, Jinchuan Group will recover its output with increasing production to estimated 11,200 tonnes. Guangxi Yinyi shrinks its output by 100 tonnes to 350 tonnes in October due to low profits of refined nickel. The estimated total domestic output of refined nickel in October is estimated to be 13,000 tonnes.

NPI

China’s NPI output grew 7.64 per cent on MoM to around 40,100 tonnes in September, which is higher than anticipation, with capacity utilization rising from 56% to 60%, mainly contributed by high-nickel iron pig.

Regionally speaking, Inner Mongolia see the biggest rise in output because of the technology of ordinary submerged arc furnaces. Plants in Inner Mongolia stop losses in the end of July and August. Driven by profits, they planned to recover or increase production during August and September, including rise in output of Dehua County Tongsheng Ferroalloy Co. and Inner Mongolia Yoquianqi Chendong Chemicals Co. Plants in other regions basically maintain full capacity or increase capacity utilization slightly driven by high profits.

In October, despite retracement of plants profits or even losses for ordinary submerged arc furnaces caused by rapid drop of price of high-nickel iron pig, with nickel ore inventories, the output in October is estimated to maintain same level as September. The 50% production limit of NPI plants during heating season in Shandong will be implemented in November, not to affect output in October.

Tin

China’s refined tin output was 11,635 tonnes in September, down 16.1% on the month, according to SMM data.

September see a relatively great slump in output because Yunnan Tin suspended output due to overhaul. Hua Tin reduced its output due to short supply caused by overhaul of mines. Chifeng Dajingzi Tin Industry made do output due to instability of furnaces. A few tin smelters in other regions were affected by short supply of raw materials, environmental inspection and weak tin prices. Three enterprises in Jiangxi will recover their production to some extent after relocation, with rise in output. The estimated domestic output of refined tin is 13,200 tonnes in October, rising 14% compared with September. This is mainly because domestic tin smelting plants persevered in their production during the National Day Holiday and Yunnan Tin and Hua Tin will recover their output since early October. Hence the output in October will rise from September.

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