Data released by the National Bureau of Statistics of China shows that in May, the output of primary aluminum reached 3.42 million tons, up by 3.1% year-on-year. It surpassed the 3.36 million tons in April and set a new monthly production record. Calculated on a daily basis, the output in May was 110,322 tons, slightly lower than the record daily level of 112,000 tons in April, but overall still maintained a strong growth momentum.
The aluminium industry analyst from Yuefeng Aluminium Research Company stated that the production in May maintained a strong trend. The lockdown measures in China did not affect the production of primary aluminium. It is expected that the production in June and July will continue to increase. Since the end of last year, the power supply in China has been generally sufficient.
Previously, in order to achieve climate goals and address power shortages, China implemented electricity usage restrictions, which affected energy-intensive aluminum production. However, since the end of 2021, the power supply situation has significantly improved, creating conditions for the full operation of aluminum smelting plants.
In 2021, China's annual production of primary aluminum reached a record high of 38.5 million tons. In the first five months of this year, China's total primary aluminum output was 16.4 million tons, an increase of 0.3% year-on-year. Meanwhile, the output of ten kinds of non-ferrous metals, including copper, aluminum, lead, zinc and nickel, increased by 3.3% to 5.64 million tons, reaching the strongest monthly level since December 2020. So far this year, the total output of the ten kinds of non-ferrous metals has increased by 0.9% to 27.25 million tons.
Impact on the global market: The continuous increase in China's aluminum production has a dual significance for the global aluminum market. On one hand, the increased supply from China helps alleviate the tight situation in the global aluminum market, especially in the context where supply in the Middle East has been disrupted due to war; on the other hand, the continuous expansion of China's production capacity may put pressure on international aluminum prices, especially under the expectation of a slowdown in global economic growth. According to Reuters, aluminum prices have dropped to a nearly six-month low, reflecting market concerns over the strong growth in China's supply and the weak outlook for global demand.
