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China readies to step up its aluminium semis export as prices rise high
China is readying to step up its aluminium semis exports in the coming quarters to leverage on the positive manufacturing climate globally, reported industry sources. The world’s largest aluminium consumer and a significant contributor of the global total metal production, China is optimistic about the demand staying buoyant in the long term due to the declining aluminium stockpiles. Higher exports of aluminium semis including aluminium bar rods and profiles, aluminium wire and stranded wire, aluminium tubes and pipes, and aluminium plates, sheets and strips could weigh down the LME aluminium prices that have surged nearly 14 per cent year-on-year.
China’s aluminium semis exports dropped last year after prices plunged at historical lows in late 2015. China exported 1.209 million tonnes of aluminium bar rods and profiles, 30168.93 tonnes of aluminium wires, 2.13 million tonnes of aluminium plates, sheets and strips, and 140355.06 tonnes of aluminium tubes and pipes in 2016.
Aluminium production rebounded by more than 20 per cent for the first two months of 2017. According to the latest data released by the National Bureau of Statistics (NBS), March aluminium production in China major markets increased by 2.5 per cent year-on-year to total at 2.70 million tonnes. Exports of aluminium bar rods and profiles, aluminium wires, aluminium plates, sheets and strips, and aluminium tubes and pipes have also stabilised but are yet to catch up.
It is projected that China will export 1.49 million tonnes of aluminium bar rods and profiles, 33721.9 tonnes of aluminium wires, 2.33 million tonnes of aluminium plates, sheets and strips, and 164578.12 tonnes of aluminium tubes and pipes in 2017.
"China semis export profitability rose 20 per cent which implies more exports over the next 3-6 months," an analyst at a global trading house observed. "A lift in semi-manufactured exports is obviously bearish for LME prices which are likely to head lower in the next few months," he said.
Ex-China global aluminium stockpiles have shrunk by almost 50 per cent to stand at 8 million tonnes, Goldman Sachs said in a recent report. Demand outpaced output in 2016; the trend is expected to continue this year as well.Get fresh Aluminium data and insights
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