[SMM analysis] the off-season has arrived, and the starting rate of the aluminum foil industry will fall in July compared with the previous month.

SMM7, 12 March: according to SMM research and statistics, the operating rate of China's aluminum foil industry in June 2019 was 87.83%, down 0.85% from May and 2% from the same period last year.

From the point of view of the subdivision products, the output of double zero foil increased steadily in June compared with May, but the order quantity of double zero foil in June and July was weak; in the aspect of single zero foil, the output of household foil and container foil remained stable compared with May, but the off-season has arrived, the domestic and foreign trade orders of related products have declined obviously, which is expected to affect the output in July. In terms of air conditioning foil, production in June was lower than in May. Air conditioning foil manufacturers said that the order volume in July decreased by nearly 20%, and the number of days of production scheduling was shorter than that in the peak season from April to May. The production schedule of the main terminal air conditioning enterprises fell from the same period last year and month to month. It is expected that the off-season of air conditioning foil this year will last until September, which will significantly affect the start-up rate of relevant enterprises from July to August. The inventory of raw materials and finished products of aluminum foil enterprises changed little in June compared with the previous month.

出口方面，海关数据显示5月中国铝箔出口量12.50万吨，环比增21.57%，同比增11.75%，主要有2点原因。第一，5月份人民币贬值，刺激国内产品出口；第二，3、4月份铝箔企业的订单量为5月份出口量做出部分贡献，而SMM调研国内铝箔企业月度开工率自3月开始表现转暖，国内外订单环比皆有回升。但随着6月份消费淡季逐渐到来，预计6-8月铝箔出口量将有下滑。

In July, the arrival of high temperature weather has limited the production of some terminal industries such as food enterprises, upward transmission will inevitably suppress the number of orders received by related aluminum foil manufacturers. In summary, with the official arrival of the off-season, the aluminum foil industry is expected to start the rate of further decline in July.