Analysis: Prebaked anode price under pressure in 2018

SHANGHAI, Jan 16 (SMM) – The price of prebaked anode is expected to trade in the range of 3,000-4,500 yuan/mt in 2018 and SMM believes a downward trend would appear in March when the heating season ends.

A total of 4.08 million mt of new prebaked anode capacity is planned for this year due to surging profits seen in 2017. However, only some 4 million mt of new capacity is expected for aluminium this year. This means that there would be an oversupply of 1 million mt of prebaked anode.

In addition, most prebaked anode producers have realised the importance of calcined coke due to the shortage last year, increasing their calcinating capacity. It is therefore unlikely to see the shortage and higher costs of calcined coke to drive the price of prebaked anode this year.

For aluminium smelters, we see a more rational pace of procurement after last year’s experience, limiting any upward room for prebaked anode prices.

Only when the winter cuts policy comes back again in October would we see the price of prebaked anode to pick up, SMM believed. 

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