The production of electrolytic aluminium is expected to fall by 220,000 tonnes, or the market will be in short supply and the prices will rise. According to information, in 2 + 26 cities the electrolytic aluminium production capacity will reach 11.43 million tons and the operation of the limit production still need to shut down the scale of production capacity for 2.61 million tons. Thus aluminum profile production will have to reduce 218000 tons per month and 870000 tons per month. The price of electrolytic aluminum is expected to rise.
The limit for protecting environment will lead to the high price of alumina and anode, and the price of electrolytic aluminum has a solid cost support. According to the calculation, the oxidation aluminum profile will reduce production capacity by 12 million tons during the environmental protection period, and the monthly production will be reduced by one million tons, corresponding to the electrolytic aluminum 500,000 tons. The anode production has been reduced more aggressively with 394, 000 tonnes of anode capacity expected to be shut down and a production cut of 330,000 tonnes a month, and the equivalent of 660,000 tonnes of aluminium profile. In addition, the success rate of aluminum profile suppliers for oxidation is low, the limit is expected to exceed expectations. The price of alumina and pre-baked anode is expected to rise sharply in heating season. The rising cost causes the electrolytic aluminum enter into a low and even losing stage, and the aluminum price has a solid cost support. According to our calculations, the electrolytic aluminum industry has started to fall into a period of low profit and even loss due to the large increase in the price of oxidation aluminum profile. We expect that in the heating season, the production cost of electrolytic aluminum will rise due to the high production of raw materials, and even the production of electrolytic aluminum will be affected by the limit of anode production.
Inventories are beginning to fall and consumption is expected to stabilize and future prices are expected to strengthen. Currently, electrolytic aluminum production capacity has been closed, and the monthly output data of electrolytic aluminum has been decreasing continuously. The monthly output is expected to fall further in November when the environmental protection season is under way. The decline in inventory and the stabilization of consumption is an important symbol of the improvement of marginal supply and demand of Chinese aluminum manufacturers, which is an important basis for the price rise of electrolytic aluminum.
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