China's aluminum production may drop by 400,000 tons

SHANGHAI-- Aluminum production in China, the world's largest producer and consumer, may fall 33 percent more than previously estimated as snowstorms persist and spread, according to CRU International Ltd. Losses may rise to 400,000 metric tons, up from Tuesday's estimate of 300,000 tons, Wan Ling, a metals and mining researcher at CRU, said by telephone from Beijing on Wednesday. Storms that swept central China were the worst in decades, delaying deliveries of coal to power stations, damaging crops and causing metal producers to reduce capacity. More blizzards are forecast in southwestern China until Feb. 6, according to the National Meteorological Office. About 1.3 million tons of capacity, up from Tuesday’s estimate of 1 million tons, “were known to have halted or be about to halt” because of cold weather and power cuts, said Wan. More capacity will likely be affected given aluminum-making is extremely electricity-consuming, she said. It would take “two or three months” for the plants to resume running, Wan said. The known affected capacities are in Guizhou, Hunan, Sichuan, Yunnan and Shanxi provinces, Wan said. All the 700,000 tons in Guizhou were halted, she said. Henan, China's biggest aluminum-making province with 3 million tons of capacity, has so far stayed immune because most producers have their own power plants, she added. China last year produced 12.3 million tons of the lightweight metal, used in car and plane parts, according to data from the statistics bureau. The Asian nation was earlier forecast by Beijing Antaike Information Development Co. to produce 15.6 million tons of aluminum this year, prior to the weather-induced reduction.