bodyType

customContents

entityId

entityUuid

articlePageQuery

filter

article

articleBaseAdvertisingInfoArticle

articleListArticle

articleSeoArticle

hooksArticleAcknowledgementGateOverlayArticle

hooksTrackPageViewArticle

hooksContentInterestArticle

articleLinkingDataContent

hooksAmpRedirectArticle

articleSchemaContent

liveArticle

advertZone

sentiment

contentLock

topics

types

sections

paywallTypes

createdDate

publishedDate

sponsorType

urlAlias

moreOnThisArticles

commentCount

authorLocations

authors

corrections

displaySlideShow

multimediaEmbed

printHeadline

seriesContainer

articleSpeeches

socialHeadline

headline

images

flag

firstTopic

glossary

flattenTypeIds

image

relatedLinks

relatedNewsletters

__typename

sponsor

pdfFiles

seriesReverseOrder

series

disableOffPlatformContent

published

updatedDate

summary

subHeadline

body

keywords

readingTime

customTimezone

liveContents

Reuters

The oversupply of aluminium on the mainland is expected to escalate in the second half of the year as more new capacity is set to come on stream, further reducing the need for imports by the world's top consumer and producer of the metal.
Smelter sources said the stronger-than-expected consumption experienced in the first half would be maintained, but they did not expect further growth this year.
Imports dropped 67 per cent in the first half from a year earlier, official data showed.
Mounting supplies would also weigh on domestic prices, which have fallen more than 5 per cent so far this year, said Zhang Chenguang, an analyst at data provider SMM.
Beijing has tried unsuccessfully to limit aluminium capacity and further tightened regulations last month for new and existing smelters.
Analysts and smelter sources said the regulations would not cut production this year but would limit expansion in the longer term.
The mainland has more than 27 million tonnes of annual capacity. About 10 million tonnes of capacity was being built, the Ministry of Industry and Information Technology said on its website.
Analysts expect the mainland to add more than 3 million tonnes of new smelting capacity this year, and the bulk of it will come from Xinjiang province.
At least 1.3 million tonnes of capacity would start up in the second half in Xinjiang, compared with about 1 million tonnes of new capacity across the country in the first half, said Zhang.
An executive at a large smelter said some new power plants in Xinjiang would also be completed in the second half, prompting smelters to start new aluminium capacity there.
"Output growth would speed up in the second half, mostly from Xinjiang," he said.
State-backed research firms Antaike and Aladdiny estimated the country's aluminium production at 12 million tonnes in the first half, with June output at more than 2 million tonnes.
The estimated figures appear higher than official data, which showed 10.58 million tonnes in the first half, with a record 1.84 million tonnes in June.
Consumption in the first half had risen about 10 per cent from a year earlier as demand from the construction, home appliance and transport sectors grew, said the executive at a large smelter, who expected demand to stay firm in the second half.
A senior executive at an aluminium user in Shandong province that buys primary metal to make semi-finished aluminium products said the firm would more than double its capacity to 2 million tonnes this year.
Reflecting a pick-up in demand, stocks of aluminium ingots in four major industrial cities fell to about 740,000 tonnes from a record 1.23 million tonnes in March, data from SMM showed.
Real consumption in the first half reached about 12 million tonnes and the demand might climb to 24.5 million tonnes for the year if the domestic economy did not falter in the second half, Zhang said.


China's aluminium market faces increased supply in second half

The mainland's aluminium market is expected to face mounting supply as more facilities begin production despite tighter regulations for smelters. Photo: Bloomberg

Business

Commodities

More capacity expected to come on stream in the second half as consumption stays steady


The oversupply of aluminium on the mainland is expected to escalate in the second half of the year as more new capacity is set to come on stream, further reducing the need for imports by the world's top consumer and producer of the metal.


China's aluminium market faces increased supply in second half

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}More capacity expected to come on stream in the second half as consumption stays steady

More capacity expected to come on stream in the second half as consumption stays steady