Reuters- old aluminum city savior now anti into a scapegoat



Reuters: old aluminum city savior now anti into a scapegoat
aluminum manufacturer of

Western countries has long been full of praise for China, be regarded as a blinding light to illuminate the bright future of the aluminum metal. are inseparable from the metal, China is to drive the global demand for aluminum the strongest surge of power.

people excited attention, not only the widespread use of aluminum in the construction and infrastructure, but also because of its closely related to consumer spending, especially reflected in the

Alcoa (AA.N: Quote) estimates that Chinas aluminum consumption increased by 15 percent last year, the global growth rate of Chinas rapid growth in car ownership. 10% of Alcoa North American, only 6 percent increase, according to Alcoa quarterly reports by the analysts it expects Chinas aluminum consumption to increase by another 11 percent this year, far higher than 4% of the rest of the world increase but in how to run the aluminum industry, that they are subject to some sharp criticism.roll aluminum.

Russian aluminum giant – Rusals equity and corporate development director Oleg Mukhamedshin called on all aluminum-producing countries responsible for the production decisions, and to more aggressively cut unprofitable production “

all the aluminum-producing countries, especially is

5 Chinas aluminum production innovation

the International Aluminium Institute (IAI) announced the latest global production data show that so depressed, why the Russian aluminum and other non-Chinese aluminum plant Chamber of Commerce. May the rest of the world aluminum production declined again, because manufacturers continue to respond to low aluminum prices and high inventory.

since October last year, the annual rate of the rest of the world outside China aluminum production has been reduced to 1.13 million tons to 2,478 tons, the London Metal Exchange (LME) aluminum prices in October last year for the first time below the aluminum production cost curve. In stark contrast, Chinas aluminum production has actually increased between April and May alone, the same 1.13 million tons, an annualized yield of 1,976 tons, a new high.

Chinas overall economic slowdown at the same time, aluminum production is so rapid growth, making the outside world by accelerating imports to save the rest of the worlds hope shattered.

; Indeed, Chinas primary aluminum imports have increased imports of January-April, an increase of 160%, but imports of 227,000 tons, but a drop in the ocean now the first four months, Chinese exports of aluminum semi-finished there are 880,000 tons, the size makes the above import data dwarfs all of these exports will replace the other parts of the demand for primary aluminum.furnace melting.

different countries, the same situation < / p>

Mukhamedshin and outside China, many other manufacturers real frustration is that, in fact the local government to the high cost of refinery subsidies in order to prevent these refineries shut down and the form of subsidies tariff discounts are usually traditional production of Henan and Guizhou province has such subsidies cost of electricity is a major cost input in the aluminum smelting process. Of course, the refinery should be closed, because their production costs close to the top of the cost curve.

but this is not true, although Xinjiang and Qinghai, northwest China, lower-cost provinces still building new refineries, which explains why China aluminum production is not shrinking, but still growing, however, the situation in China is just a microcosm of the rest of the world

the aluminum industry overcapacity, millions of tons of metal in the warehouse accumulated dust, in order to survive down, would have to drive down the cost curve. as Alcoa in Saudi Arabia to establish new capacity can Rusal in-depth development of Siberia, like Chinese manufacturers but also to the west transfer play a in the area of ​​coal reserve potential of the advantages in order to

these moves naturally will lead to higher-cost countries or provinces to take action to prevent the resulting tax revenue and job losses. only Australia seems determined by the carbon tax increase the burden of the cost of doing business, thereby forcing the countrys aluminum smelting industry production to other countries and regions actively prevent the refinery closure plan, in Italy, for example, Alcoa will be in the Portovesme refinery in the country future issues to local government compromise.

Alcoa, Italy and the European Commission between the number of legal battle also illustrates this point. European Commission finds that Alcoa Italy refinery previously power agreements are to enjoy the illegal government aid.

its expect China not as good as their own action

Chinese aluminum production pace does not seem to too may any change to the old high cost of production can continue to shut down, due in part to government intervention, its shut down more slowly in the country around the lower-cost new capacity on line speed. This may lead to the country the refinery production pace to maintain rally, while the national production costs continue to decline.

apparently there is no reason to speculation that the pace of Chinese imports there will be any change, imports will continue to be subject to arbitrage opportunities fluctuations. This means that the Russian aluminum and other manufacturers If you want to help stabilize the market, they must stop waiting for China to respond from their own actions. the West itself, the production does not seem to cut too much in the past six months, the annual rate of production of 1.13 million tons of data some water.

part of the production is based on non-price related to the reduction form, such as BHP Billiton South Africa Hillside refinery interrupt the run, and Rio Tinto Canada Alma refinery continued to lay-off

In addition, in the past few months refinery closing speed of the significant slowdown in Norsk Hydro. only been widely expected in the full cut of Australia Kurri Kurri refinery, an increase of little new power.

this purpose, the Russian aluminum itself did not cut, although the company in recent months has been talking about the second half of this year will be cut.

Rusal really want all manufacturers held responsible for the production, “then may have to look at their capacity utilization, rather than blame China.


Tags:
f