SMM, July 11, 2020:
During the epidemic period, SMM tracked the start-up situation of aluminum downstream processing leading enterprises on a weekly basis in order to understand the most real situation of aluminum downstream processing enterprises resuming work. SMM survey samples are distributed in 12 provinces in China, a total of 41 enterprise samples, the specific distribution is as follows:
This week, the employment of leading enterprises downstream of aluminum increased slightly by 0.4% to 77.3%. The increase was mainly due to a slight increase in the start-up of some primary alloy enterprises, but downstream hub enterprises had the habit of high temperature holiday in the hot weather in July. this growth may be difficult to continue. Other downstream plates are relatively stable as a whole, including aluminum profiles, aluminum foil orders performance is better, most orders can still be scheduled to August. New orders for aluminum strip and cable weakened, scheduling and delivery time were shortened. The recycled aluminum industry is still mainly impacted by imported aluminum alloy ingots, so it is difficult to recover significantly in the short term, and July is the traditional off-season, and there are plans to reduce production and holiday in the lower reaches of the high temperature, and the actual start-up may still decline. It is expected that the weekly start of aluminum downstream next week is likely to continue to weaken slightly, and the decline in construction will first be reflected in cable and strip enterprises.
In terms of specific product types:
Primary aluminum alloy: the weekly operating rate of primary aluminum alloy rebounded to 63.3% this week, an increase of 5 percentage points over last week. The reason is that one of the enterprises in the sample increased the start-up load due to the increase in orders. From the perspective of the average situation of the industry, due to the reduction of production in the downstream wheel plant during the high-temperature holiday, it is possible to start a month-on-month decline in July, so it is not universal for individual primary aluminum alloy enterprises to increase production. It is expected that the operating rate of primary aluminum alloy will be basically stable next week.
Aluminum strip: the operating rate of large-scale plate and strip enterprises is basically stable this week, but from the overall new orders, there is a weakening trend in the follow-up. Due to the increased demand for beverages, beer and other products in the summer market, enterprise orders for main can materials and pull ring materials in Shandong, Henan and Fujian are still abundant, and the operating rate has not been greatly affected. however, the orders of other large plate and strip enterprises with a more diversified product structure in Henan are shrinking obviously, and the delivery time is generally two weeks in 1rel, which is about two weeks shorter than the peak season in May. From the product point of view, building plate, decorative strip, automobile plate and 3C and other products are mediocre, not very bright. Large enterprises are pessimistic on a month-on-month basis.
Aluminum cable: the operating rate of large cable companies this week is basically the same as that of last week. Large cable enterprises in Jiangsu generally have a high operating rate and relatively stable new orders, but they say that the order increment is lower than expected after entering the seasonal off-season, and the construction progress of cable overhead projects in summer has slowed down, and customers have been slow to pick up goods. Individual enterprises said that their finished product inventory has increased. Raw materials, due to the sharp rise in aluminum base prices, aluminum rod processing fees, although there is a pullback, but the purchase cost of raw materials is still rising, enterprises are currently mainly on-demand procurement, inventory days are generally 2mi 3 days.
Aluminum profiles: the operating rate of large-scale enterprises of aluminum profiles remains stable, the head of large enterprises basically produce at full capacity, and there are plans to increase production capacity on the new machine, the delivery schedule is generally at 20 Mel for 30 days, and the specific conditions are adjusted according to the customers. in addition, some orders have not been included in production. Orders and construction of construction profile enterprises are still strong, and the demand for real estate and infrastructure is more sustained during the completion cycle. The export performance is not satisfactory, and the appreciation of the RMB and the second outbreak of the overseas epidemic are also not conducive to the export of enterprises. In terms of raw materials, the price of aluminum ingots continues to rise, the processing fees of aluminum bars fluctuate greatly, and the long-term implementation is normal unilaterally. in addition, downstream enterprises in Guangdong have increased their purchases of low-cost imported aluminum ingots. The summer off-season has a certain impact on the orders of some enterprises, but the operating rate of leading enterprises will remain high.
Aluminum foil: the operating rate of large aluminum foil enterprises fell slightly this week. At present, large aluminum foil enterprises said that their air conditioning foil and food soft package foil orders are still good, and the relevant order production can basically fill the whole July or even August, especially in Jiangsu and Henan areas. other products such as sealing foil, decorative foil and other performance is OK, but electronic foil, battery foil brazing foil is still weak, and the start-up of related enterprises is affected. On the whole, the aluminum foil plate performs better in all downstream consumer plates.
Recycled aluminum alloy: the leading enterprise of recycled aluminum started to maintain 51.7% this week. On the whole, at present, the coastal areas are greatly impacted by imported aluminum alloy ingots, especially the Guangdong region. In addition, Huawei has been sanctioned by the United States. Huawei's related 5G base station orders have also declined sharply compared with the same period last year. Relatively speaking, Chongqing is less impacted by imported aluminum alloy ingots because it is located inland, and the current market price is higher than that of Shanghai and Guangdong. It is worth noting that in the case of slow recovery of automobile consumption, the demand for related civilian products is relatively strong, and its corresponding non-standard aluminum alloy ingots are less impacted by imported aluminum alloy ingots, on the contrary, they have greater advantages than national standard products in terms of supply and demand balance and profits. some small and medium-sized enterprises actively transfer production capacity to produce non-standard aluminum alloy ingots. In terms of import and export, due to a slight recovery in overseas demand, especially the emergence of a certain recovery in Japanese demand, overseas aluminum alloy quotations rose slightly, superimposed due to concerns about the uncertainty of the landing of new waste aluminum standards, new imports decreased, and imported aluminum alloy ingots narrowed compared with domestic price differences, which may also enhance the competitiveness of domestic products and provide some support for domestic enterprises to start work.
(Shanghai Nonferrous net Aluminum Group)