[Al] CBI Survey - Operating Rates at Aluminum Profile Producers

SHANGHAI, May 4 (CBI China) -- A recent CBI survey of 26 domestic aluminum profile producers (total capacity: 1.6913 million mt/yr) revealed the following insights:

    1)  Production

    According to the survey, the average operating rate at the 26 aluminum profile producers rose by 5% during April, but growth rates were down slightly compared to March. Operating rates at medium and small producers increased significantly to over 60% during April, an overall indication of demand recovery in the aluminum profile sector. However, the limited growth of operating rates at large producers signaled market consumption was still weak, and could be attributed to the depressed export market. Although the Chinese Government imposed a 13% export rebate on aluminum profiles on April 1st, exports of aluminum profiles experienced no improvements due to weak overseas demand.

    2) Forecast of May Orders

    The survey reveals 50% of aluminum profile producers believe orders will not increase significantly in May, and this opinion group consisted mainly of export-oriented aluminum profile producers in China’s coastal areas, especially Guangdong province. While nearly 25% of producers believe orders will increase during May, they come mainly from North China, who can rely on stronger local demand for civil architectural products. The remaining 25% of producers said orders will decrease during May. 

    3) Forecast of May Prices

    Aluminum prices did not advance during April, and prices experienced marked declines by the month’s end, leading aluminum profile producers to become pessimistic toward May aluminum prices. According to the most recent survey, 46% of producers were uncertain about prices in May,  15% believe prices will continue to fluctuate, and 39% believe aluminum prices will fall due mainly to increases in aluminum output. However, CBI believes aluminum profile producers lack confidence in future demand, and this is contributing to their pessimistic attitude toward prices.

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