China: No let-up on primary production despite low prices

With low aluminium prices causing no end of despair on the global market, there appears to be no let-up on primary production in China with new capacity coming on stream and May’s production of 1.77Mt pointing to an annualised rate of 20.8Mt.

From January to May, China produced 8.73Mt of primary metal, up 8.25% on the same period last year, with Xinjiang’s five-month production up a staggering 185%, followed, not even closely, by Guangxi with 40%, Shaanxi (34%) and Guizhou (32.62%).

Chinese exports of primary aluminium for the period were 45.8Mt (a decline of 11.6%) while imports year-on-year declined by nearly 70% to 81kt.

May’s primary metal imports increased by 55.5% to 21.8kt.

Over the five-month period, semis production reached 14.6Mt, up 23.5% year-on-year compared with 14.6% growth in 2012. Exports of semis, however, were flat – up 6.45% to 1.21Mt. Expansion of semis production is unlikely to be sustained for 2013 and local demand for aluminium will grow by 10% for the entire year.

The Chinese construction industry, which normally accounts for 35% of total aluminium consumption, showed some improvement. National Bureau of Statistics figures revealed that real estate development increased by 20% year-on-year over the five-year period and that growth was up by 4.4% when compared with the whole of 2012.

The China Association of Automobile Manufacturers claims that car production for the January to May period was up by 13.4% compared with the same period in 2012.