SMM monthly output data of basic metals in China is scheduled to be released around the 8th of each month. It aims to proceed from the essence, excavate the real fundamental situation, open up the illusion of the capital market for people in the industrial chain and investors, and grasp the future trend of the non-ferrous market more clearly.
Overview of basic Metal production in China in February 2020
In March 2020, SMM's electrolytic copper production in China was 743700 tons, an increase of 8.87% over the previous month and a decrease of 0.98% from the same period last year. In the first quarter, SMM China's electrolytic copper production totaled 2.1527 million tons, down 2.46 percent from the same period last year. After the problem of sulfuric acid reservoir expansion was alleviated, except for the routine maintenance of some refineries, the primary smelting part of the refinery basically returned to normal in March, and the recovery rate of some refineries was faster than expected after the maintenance, which led to a significant recovery in domestic electrolytic copper production in March. In addition, as the domestic economy was hit by the epidemic in the first quarter, copper smelting enterprises as the pillar of the local economy also need to maintain production stability. However, due to the sharp narrowing or even upside down of the price gap between refined waste and copper in March, as well as the impact of the epidemic on source countries such as Malaysia, part of the production of recycled smelting in March is still in a state of contraction.
Although the problem of sulfuric acid storage improved in March, SMM learned that the decline of domestic sulfuric acid prices, especially in the northern region, was obvious, small and medium-sized refineries generally reflected that they were squeezed by large profits, and some refineries in the north would be overhauled in the near future to adjust them. On the other hand, since late March, the epidemic situation in major mining countries such as Peru and Chile has entered a period of development, and copper concentrate production activities and port transportation have been disrupted. Taking into account factors such as the transport cycle, it is expected that the supply of copper raw materials may be tense from May, affecting domestic electrolytic copper production.
According to the refinery scheduling plan, SMM expects domestic electrolytic copper production to be 741000 tons in April 2020, down 0.36 percent from the previous month, an increase of 4.88 percent over the same period last year. By April, the cumulative output of electrolytic copper was 2.8937 million tons, down 0.68 percent from the same period last year. Although many refineries carried out routine repairs in April, electrolytic copper production is expected to be roughly the same as in March as new capacity continues to crawl and the impact of the epidemic recedes.
According to SMM data, China's alumina production in March (31 days) was 5.668 million tons, including 5.434 million tons of metallurgical grade alumina and 175300 tons of metallurgical grade daily output, down 1.75% from the previous month and 9.72% from the same period last year. In March, domestic alumina plants increased and reduced production in parallel, mainly due to the gradual feedback of the reduced production capacity in Shanxi in late February to the reduction in March. In March, due to the easing of the shortage of raw material supply, individual electrolytic aluminum plants had the behavior of increasing production, but the increment was relatively limited. therefore, the average daily output in March decreased slightly compared with the previous month.
By the beginning of April, the operating capacity of metallurgical grade alumina had increased to 64.28 million tons, and the output of metallurgical grade alumina was expected to be 5.257 million tons in April (30 days), with the average daily output of metallurgical grade maintained at about 175000 tons. However, due to the current alumina price has fallen more than 400 yuan / ton compared with the high level after a year, the domestic high-cost alumina production capacity will once again face the choice of production reduction, we need to continue to pay attention to the change of ore cost and the price trend of alumina market.
According to SMM data, China's electrolytic aluminum output in March 2020 (31 days) was 3.036 million tons, an increase of 1.9 percent over the same period last year. By the end of March, the operating capacity of electrolytic aluminum in China was 36.21 million tons / a, with an annual capacity of 41.23 million tons / year. The operating rate of electrolytic aluminum enterprises in China was 87.8%. The overall operating rate was 1.5 percentage points lower than that at the end of February 2020. by the end of March, The operating capacity of domestic electrolytic aluminum is down 390000 tons per year compared with the end of February. Since mid-March, 10 domestic electrolytic aluminum enterprises have been affected by the decline in aluminum prices to focus on maintenance, SMM statistics cumulative maintenance capacity rose to 655000 tons / year, and with the continued downturn in aluminum prices, the proportion of production capacity with cash loss remains high, thus driving the scale of electrolytic aluminum production reduction to continue to rise.
In the first quarter of 2020, the cumulative output of domestic electrolytic aluminum was 8.976 million tons, an increase of 4.0% over the same period last year. In the first quarter of this year, the cumulative consumption of domestic electrolytic aluminum was 7.506 million tons, down 9.0% from the same period last year. After entering April, affected by the downturn in aluminum prices, it is expected that the scale of electrolytic aluminum production capacity will continue to expand, and some new production capacity in Yunnan, Inner Mongolia, Guangxi and other provinces will be delayed. SMM estimates that domestic electrolytic aluminum production in April (30 days) will be 2.92 million tons, down to 1.0 per cent year-on-year growth rate.
In March 2020, the national output of primary lead was 240000 tons, up 11.94 percent from the previous month and down 7.03 percent from the same period last year. Cumulative production fell 6.13% from January to March compared with the same period last year.
According to research, the impact of the Spring Festival has basically come to an end, and at the same time, with the effective control of the domestic epidemic situation, some small and medium-sized smelting enterprises have resumed work one after another, such as Hunan Yuteng, Yunnan Zhenxing, Henan Yuguang, and so on, and the overall output has increased significantly. During the period, the western mining industry, Inner Mongolia Xingan silver lead and other maintenance conditions, offset some of the increase in production, the overall output increase in March is basically in line with expectations.
Looking forward to April, in addition to a small number of smelting enterprises in the case of small maintenance, other primary lead enterprises basically maintained normal, coupled with the maintenance of enterprises in March have recovered, the overall output continued to increase month-on-month. In addition, considering the escalation of the overseas epidemic situation, the mine import is blocked, and the domestic seasonal factors, such as Inner Mongolia and other high-altitude mines have not yet resumed work, resulting in a tight supply of domestic lead concentrate and a decline in lead processing fees. The Pb50 processing fee of SMM4 monthly lead concentrate (domestic) is reported to be 2000-2400 yuan / metal ton, down 200 yuan / metal ton compared with March, and the imported Pb60TC is reported to be US $140-160 / dry ton, down US $20 / dry ton compared with March. If the mine supply continues to tighten, it is not ruled out that it may have an impact on the production of electrolytic lead smelting enterprises. SMM expects primary lead production to rise to 257000 tonnes in April on a month-on-month basis.
The output of refined tin in March was 12000 tons, an increase of 59.9 per cent over February. The obvious increase in refined tin production in March over February is mainly due to the limited production time of some refineries affected by the epidemic situation during the Spring Festival holiday in February, resulting in a relatively small base of refined tin production data in China. In March, most refineries gradually resumed production, and some of the raw materials before the Spring Festival finished tin ore inventory imported into China, refined tin production has been significantly increased. However, as the overall operating rate of Myanmar's tin mining enterprises remains relatively low, the continuity of short-term tin supply remains to be seen, and some refineries affected by tin supply say that there may be a reduction in production in April. Refining tin production is expected to shrink to around 11000 tons in April.
In March 2020, the national output of electrolytic nickel was 15600 tons, an increase of 16.03% over the previous month and 21.59% over the same period last year. According to a preliminary survey by SMM, production rose in March, on the one hand, because the natural days of the month were longer than in February, and on the other hand, the domestic return to work environment was also more stable and orderly than last month, and most of the smelters currently in production were producing more than last month. Among them, Jilin smelter has returned to the capacity release rate of the same period last year and began to produce electrolytic nickel normally, Gansu and Xinjiang smelters are currently in good production and normal scheduling. Due to the continued decline in nickel prices in March, Shandong and Tianjin smelters still maintain low-load production for the time being due to cost reasons. It is reported that although the two enterprises use imported intermediate products as raw materials, due to the preparation of raw materials in the early stage, the scheduling will not be affected in the short term. The electrolytic nickel production line at the Guangxi smelter is still suspended and is expected to resume in the fourth quarter.
In April, domestic electrolytic nickel production is expected to be 15500 tons, down 0.96 percent from the previous month. The number of natural days in April decreased, and the discharge output of each smelter decreased to a certain extent. However, if nickel prices continue to decline and the foreign epidemic continues to worsen, or increase cost pressure on manufacturers using overseas ores and intermediates as raw materials.
Nickel pig iron
National production of nickel pig iron fell 4.46 per cent to 40200 nickel tons in March from a month earlier, down 12.25 per cent from a year earlier, and production has fallen month by month since November 19 (53100 nickel tons). In terms of grade, the output of high nickel and iron in March was 33800 nickel tons, which was 5.47% lower than that of the previous month, while that of low nickel iron in March was 6400 nickel tons, an increase of 1.3% over the previous month. In March, the output of nickel pig iron continued to decline, and most of the reduction was reflected in the part of high nickel pig iron. The main reasons are as follows: 1. The market price of high nickel pig iron has basically fallen below the cost line of all domestic iron plants, the production pressure is high, and some iron plants have chosen to reduce the output. 2. Affected by the epidemic situation, many mining areas in the Philippines have been blocked, and the shipment of nickel mines in April is more pessimistic. The stock of nickel mines in most domestic manufacturers has been reduced to 1-2 months, and the stock of raw materials is tight. At present, some manufacturers have stopped production because of nickel ore depletion. Some manufacturers have also chosen the current low price of nickel iron to overhaul or reduce production to cope with the impact of nickel mine shortage; 3. The proportion of nickel raw materials in stainless steel plant is due to the continuous decline in the price of pure nickel and stainless steel, the price of waste stainless steel has been partially adjusted, and the demand for high nickel pig iron has been reduced. In March, the production of 200 series stainless steel resumed, and the output of low nickel and iron in the integrated steel plant increased, which was basically the same as that in February. The dynamic balance of increase and decrease in the part of low nickel pig iron was suspended in March due to the depletion of nickel mine, but the production of 200 series stainless steel resumed.
In April, national nickel pig iron production is expected to continue to decline month-on-month, by 5.11% to 38200 nickel tons. Among them, the output of high nickel pig iron decreased by 6.91% to 31500 nickel tons. The ring ratio of low nickel pig iron increased by 4.39% to 6700 nickel tons. With the further consumption of nickel mine inventory in April, the market is still pessimistic about the price expectation of high nickel pig iron in April, and the willingness to reduce production is further strengthened. the increase in low nickel pig iron production is mainly due to the resumption of production in large 200 series integrated stainless steel plants.
In March, China's nickel sulfate output was 10500 tons of metal, while the physical amount was 47800 tons, an increase of 62.39 percent over the previous month and a decrease of 14.72 percent from the same period last year. Among them, the output of battery grade nickel sulfate is 42200 tons, and that of electroplating grade nickel sulfate is 5600 tons. The larger increase in nickel sulfate production this month is mainly related to the resumption of work in most enterprises in March. Due to the serious impact of the epidemic in February, the start of work was seriously hindered. In March, the epidemic situation improved, and the resumption of work in nickel sulfate plants and downstream enterprises was obvious. In addition, although the starting situation of nickel sulfate downstream enterprises is lower than that of last year, the demand for nickel sulfate has increased month-on-month compared with February under the influence of this year's epidemic. National nickel sulfate production is expected to rise 6.24 per cent to 11200 metal tons in April from a month earlier.
In March 2020, the output of SMM refined zinc in China was 464200 tons, an increase of 2.48% over the previous month and 2.67% over the same period last year. SMM research sample capacity of 6.085 million tons. In addition, in March, the output of sample alloy in domestic refining zinc smelter was 68700 tons, an increase of 1.68% over the previous month, of which the output of hot-dip galvanized alloy was 48500 tons.
According to the SMM survey, the domestic refined zinc production in March is basically in line with the expectation of month-to-month increment. In March, refineries in Inner Mongolia, Gansu and Qinghai entered routine maintenance one after another, affecting the precipitation of certain output, but at the same time, some refineries that reduced production in February due to the shortage of raw materials and ceased production during the Spring Festival resumed production in March one after another. The output of refined zinc declined and declined in March, so the domestic output increased by 2 percentage points in March compared with the previous month.
In April, according to SMM, overseas epidemic fermentation led to the suspension of production of mines and refineries in Peru, South Africa, and other regions. Due to their low stock of raw materials, domestic refineries are now worried about the supply of long-term imported minerals. In addition, domestic mines have only produced and not sold because of price and other factors. Recently, domestic and imported zinc ore processing fees have been rapidly reduced. As of April 3, the national 50 grade domestic zinc concentrate processing fee is 5800 yuan / metal ton. The processing fee for imported zinc concentrate is US $230 / dry ton, and this week, the domestic minimum import TC has reached US $200 / dry ton. Some refineries may start maintenance plans ahead of time because of tight mine supply and other problems. From the production schedule in April, domestic refineries are still mainly in Hunan, Inner Mongolia and Shaanxi, while refineries are overhauled or concentrated in May to June. To sum up, Domestic refined zinc production is expected to increase by 15900 tons to 480100 tons in April compared with the previous month.
1. The value with * is the corrected value, and the value in italics is the predicted value.
2. The output of nickel pig iron refers to the data after the physical quantity is converted into metal.
1. Research methods
SMM production research is conducted by professional analysts by telephone, field research and other means, regularly carry out monthly tracking of Chinese metal production enterprises, and issue a report on Chinese metal production.
In the process of research, ensure the basic coverage proportion of the sample, and continue to expand; at the same time, consider the size of production capacity, geographical distribution, enterprise nature and other details of the reasonable selection and distribution of samples, so that each sub-item data is representative.
Production data include last month's output (initial value), the previous month's output (revised value) and the forecast for the current month's output. In general, SMM rarely modifies the output, that is, the correction value = the initial value, but still retains the possibility of correction.
Before the 10th of each month through the Shanghai Nonferrous Network official website (www.smm.cn), WeChat subscription account (Today Nonferrous), mobile phone station (m.smm.cn) and other official channels to the public.
2. Sample introduction
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