China’s aluminium output in July slipped for a third month, with daily average levels at the lowest since October 2020, official data showed on Monday, as continued power shortages in the south of the country kept smelter operating rates low.
The world’s top producer of the metal churned out 3.26 million tonnes of primary aluminium last month, the National Bureau of Statistics said. That was down 0.9% from June’s 3.29 million tonnes but up 7.4% year-on-year.
On a daily basis, July output works out at 105,161 tonnes per day, versus around 109,700 tonnes in June, according to Reuters’ calculations.
The aluminium hub of Yunnan, in southwest China, reimposed curbs on power consumption by producers last month, before smelters, hit by an initial round of restrictions in May, had restored operating rates.
Yunnan, which accounts for around 10% of China’s primary aluminium capacity, lured smelters with its usually abundant clean hydro-power resources for the energy-intensive smelting process.
However, the province has faced a power crunch in recent month due to severe drought and measures to limit pollution while electricity demand jumped.
The neighbouring Guangxi region this month tightened its own restrictions on power usage by smelters in a move analysts say could shut about half a million tonnes of annual capacity.
“Entering July, the country’s tight electricity supply situation become more severe,” said metals consultancy Mysteel.
“In the current power shortage environment, the commissioning of new electrolytic aluminium projects in Yunnan, Guangxi, Guizhou and other places will inevitably be postponed,” it said.
Despite tight domestic supply, China’s aluminium exports in July were the highest since March 2020 at almost 470,000 tonnes..
China’s output of 10 nonferrous metals – including copper, aluminium, lead, zinc and nickel – was 5.37 million tonnes in July, the statistics bureau said. That was down 2.1% from 5.49 million tonnes in June but up 7.1% year-on-year.
The other metals in this group are tin, antimony, mercury, magnesium and titanium.
Source: Reuters (Reporting by Emily Chow, Tom Daly and Mai Nguyen; Editing by Christian Schmollinger and Michael Perry)