The mystery of electrolytic aluminum production capacity "excess"

One afternoon at the end of June, hundreds of tons of aluminum ingots were neatly arranged at the entrance of the production workshop of Henan Honglong Longquan Aluminum Co., Ltd., the largest electrolytic aluminum enterprise in Henan Province, with dazzling silver light shining in the afternoon sun. This is the two-day production capacity of the workshop, which will be shipped to downstream aluminum processing enterprises within two days. "Now the electrolytic aluminum market belongs to the seller's market, and the company has no inventory." Yu Junjie, the trade manager of Yugang Longquan Aluminum Co., Ltd., is satisfied with the current market conditions. He told reporters that the company is basically full-load production, but the products are still in short supply. The enterprises that come to purchase aluminum ingots must first pay before they are shipped, otherwise they will not buy aluminum ingots.   The shortage of electrolytic aluminum and aluminum ingots is also common among other companies visited by reporters. Minister Chi Junqing of the Xinfa Group, a large private enterprise with the most complete industrial chain in Shandong, told reporters that the company's electrolytic aluminum products were basically digested in Shandong, and only a very small number of products were sold to the East China market. A market analyst of Shandong Weiqiao Aluminum & Electric Co., Ltd., another large electrolytic aluminum producer in Shandong Province, also told reporters that most of the company's products are digested locally, in addition to maintaining a supply relationship with a handful of strong old customers, some small ones. Aluminum processing companies are no longer able to meet the supply. Obviously, the above situation is quite different from the rumor that "electrolytic aluminum is a surplus industry". “In fact, we are also unbelievable about the strong demand for downstream aluminum processing enterprises in China.” Weiqiao Aluminium's market analyst told reporters that when the company's 50,000 tons of electrolytic aluminum production capacity was just put into production in 2005, they often produced aluminum. When the ingots are sold out, they are worried. Looking at the aluminum ingots that are in the warehouse, they often feel pressure. Today, the company's electrolytic aluminum production reached nearly 1.2 million tons, but the company's products are in short supply. Now it's just a matter of ordering the goods, and the work is much easier than before. She believes that the Chinese terminal market has great potential for the consumption of aluminum products. In response, the reporter noted that both spot aluminum prices and futures prices have continued to rise since June. Zhu Shiwei, a metal analyst at Yongan Futures, believes that the rise in prices has already indicated a shortage of spot aluminum. Huang Fulong, deputy general manager of Guangzhou Kaitou Commodity Information Consulting Co., Ltd. believes that the downstream demand for electrolytic aluminum may be the main reason for the price increase. According to Jun Junjie, the strong demand is closely related to the rapid development of the local aluminum processing industry in Henan Province. He told reporters that under the policy of the Henan provincial government to develop the aluminum industry deep processing industry, Henan aluminum processing enterprises have developed very rapidly. In addition to large aluminum companies, there are many small aluminum processing companies quietly built. He estimated that the current consumption of electrolytic aluminum in Henan Province may exceed 3 million tons, accounting for about 80% of the total production capacity of electrolytic aluminum in Henan Province. He believes that China's electrolytic aluminum production and demand are matched, there is no serious excess problem. During the visit, the reporter also found that around these large-scale electrolytic aluminum enterprises have begun to form an aluminum industry cluster. Relevant personnel of Henan Dengfeng Aluminum Co., Ltd. told reporters that in recent years, many aluminum processing enterprises such as architectural profiles and aluminum strips have emerged spontaneously around the company, some of which are from Guangdong. Around Shandong Weiqiao Aluminium Power Company, a huge aluminum industry cluster has been formed, which can consume nearly 70% of the company's 1.2 million tons of electrolytic aluminum production. However, despite this, overcapacity of electrolytic aluminum is still one of the most concerned topics in the industry. Many non-ferrous metals analysts contacted by the reporter said that the current macroeconomic trend in China is uncertain. The demand for aluminum products in real estate, home appliances, real estate and other industries is weakening. There will still be many market demand for aluminum products in the second half of this year. Uncertainty. In addition, whether the gradual release of electrolytic aluminum production capacity in the western region will break the current tight supply of electrolytic aluminum industry is also a concern in the industry. It is noteworthy that in April this year, the Ministry of Industry and Information Technology and other nine ministries jointly issued an emergency notice, calling for the 7.48 million tons of electrolytic aluminum project. The industry generally believes that the possibility of new electrolytic aluminum production capacity in China will be greatly reduced in the future, which will benefit the industry.  

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