SMM, April 17, 2020:
During the epidemic period, SMM through the aluminum downstream processing leading enterprises start weekly tracking, in order to understand the most real aluminum downstream processing enterprises return to work. SMM survey samples are distributed in 12 provinces in China, a total of 41 enterprise samples, the specific distribution is as follows:
To sum up, the start of aluminum downstream leading enterprises this week showed a small decline, the overall still stable. Among them, the raw aluminum processing plate building materials industry has reached full production, the follow-up high probability to maintain a stable state, continue to ascend space is very limited. Other sections only related to construction, medicine-related orders are still hot, but it is still difficult to hide the lack of overall consumption growth. It is worth noting that due to the continuous rise in aluminum prices, the price difference between recycled aluminum and raw aluminum has been greatly reduced, the current recycled aluminum enterprises have been unable to use A00 aluminum to supplement raw materials. For future orders, export order concerns did not abate in May, and there is still a risk of an export order fault in May. It is expected that the overall start of the aluminum processing industry next week is stable, affected by the decline in some export orders, or will continue to decline slightly.
Specific product types:
Primary aluminum alloy: the operating rate of the top five enterprises of primary aluminum alloy continued to hold steady at 61.8% this week. The majority of A356.2 aluminum alloy is delivered on a monthly basis, and the main reason for the small change in the start-up condition of each factory in the middle of the month is that the order is relatively stable. Individual primary aluminum alloy plants have plans to increase production in May as a result of the decline in finished product stocks, but given the order and start-up status of aluminum wheels, it is unlikely that the operating rate of primary aluminum alloy will pick up significantly in the short term.
Aluminum plate and strip: the operating rate of large plate and strip enterprises this week is slightly higher than that of last week. Major large plate and strip enterprises said that due to the existence of a backlog of orders in the early stage, the operating rate at the beginning of April was still stable, individual enterprises reported that orders for building plates and medical plates and belts were relatively good, and orders for automobile plates and packaging cans were still weak. foreign trade orders are still more affected than domestic trade. With the gradual escalation of the overseas epidemic situation, the withdrawal of customers has become more prominent, and the maritime shipment of their own products has been blocked, and overseas banks have been closed because of the epidemic, and considering the problem of credit risk, they dare not take the initiative to ship goods. At present, the inventory of finished products is still high. Raw materials, large plate and strip enterprises partial self-use group aluminum ingots (or plate ingots), raw material inventory is more stable, need to purchase enterprises basic on-demand procurement. At present, the overall situation in May-June is still more worried, that the May pre-order superposition effect will disappear, at this time the pressure will be more obvious than the previous period.
Aluminum cable: the operating rate of large cable enterprises this week is lower than that of last week, mainly due to the obvious impact on the export orders of individual enterprises, especially in Central Asia, West Asia and South America. Due to port closure, the shipment of domestic cable enterprises is blocked. The resulting inventory pressure is more obvious; Domestic trade, large domestic cable enterprises are feedback, the current orders are still received last year, this year's new orders are still less, the national network has not released a large number of tenders, and the relevant distribution network line projects are still slow to start, for the time being do not have too much expectation for the first half of the year, mainly concerned about the second half of the national network bidding and domestic and foreign epidemic control.
Aluminum profile: the operating rate of profile enterprises is relatively stable this week. The construction profile maintains a positive trend, the overall situation is better than the industrial profile, the production orders of large enterprises are still stable, the follow-up orders of small and medium-sized enterprises are slightly inadequate, and the negative impact of export business is still continuing. Processing enterprise raw material inventory has accumulated, some end customers also copy the bottom aluminum price hoarding, individual stock is large enough for a few months of consumption; the problem of pre-finished product inventory backlog has been slightly alleviated, the enterprise actively out of the pre-Qing production completed but delayed the delivery of orders. In the short term, the adjustment of the overall operating rate of profile enterprises is limited, mainly stable in April.
Aluminum foil: in terms of export, each enterprise faces the same general environment, export is not smooth, although more than last month that export orders have been arranged to the end of May, but due to different export targets, the export situation among enterprises is different. Exports from Southeast Asia have stagnated, compared with those from Europe and the United States, but better than those from Southeast Asia. From the point of view of sub-products, air-conditioning foil is worse than the same period last year, and now enterprises are more pessimistic about the original peak season, and the profit of air-conditioning foil itself is low, and some enterprises have begun to transform; pharmaceutical foil is hot, orders are not worried, and full production is running; electronic foil is facing export pressure, and the operating rate is declining; packaging foil, like last week, has been affected by the epidemic. Overall, foreign demand this week and this month is now down about 1/3, while domestic demand is also slightly higher than last week, with the operating rate down 1.7 percent from last week. As the epidemic in Europe and the United States has not yet shown signs of improvement, aluminum foil production rate is expected to decline slightly in late April.
Recycled aluminum alloy: the operating rate of recycled aluminum leading enterprises remained stable this week. The current orders of recycled aluminum enterprises mainly come from domestic, and export orders remain weak. Due to the continued rise in aluminum prices within the week, the price difference between ADC12 and A00 aluminum narrowed, recycled aluminum enterprises can no longer use A00 aluminum in the second half of the week. At the same time, due to the rise in aluminum prices, domestic waste aluminum prices continue to rise, but also to a certain extent, aggravate the cardholders cherish the sale psychology, so that the domestic waste aluminum supply remains scarce. On the other hand, the weakness of domestic and foreign orders has forced enterprises with relatively large export orders to snatch domestic orders at low prices, suppressing the price of domestic recycled aluminum ADC12. However, with the continuous rise in aluminum prices, supported by the cost of domestic ADC12 quotation rose slightly, if the domestic auto terminal consumption recovery remains slow, the downstream die casting enterprises are difficult to accept the rising ADC12 price, then there will be a high probability that recycled aluminum enterprises will stop production.
(Shanghai Nonferrous Network Aluminum Group)