09 JULY 2015Bloomberg
Alcoa raises aluminum surplus forecast on China output
Edited by : AL CIRCLE
1 min read
Alcoa Inc., the largest U.S. aluminum producer, more than doubled its estimate for the global supply surplus this year amid increasing output from China.
Supply will exceed demand by 762,000 metric tons, the company said Wednesday in its second-quarter earnings presentation. That’s up from an April estimate of 326,000 tons. Total demand is expected to reach 57.5 million tons this year, Alcoa said.
The revision was driven by lower expectations of Chinese capacity curtailments, Chief Financial Officer Bill Oplinger said on a conference call. China will add 2.8 million tons of production capacity this year, Alcoa said in the presentation.
The country already accounts for half of the world’s aluminum output and is on pace to export record amounts of products made from the lightweight metal this year.
The supply glut has depressed metal prices in recent years and prompted New York-based Alcoa to idle higher cost smelters and instead focus on the manufacture of more profitable aluminum components for the auto and aerospace markets.
Supply will exceed demand by 762,000 metric tons, the company said Wednesday in its second-quarter earnings presentation. That’s up from an April estimate of 326,000 tons. Total demand is expected to reach 57.5 million tons this year, Alcoa said.
The revision was driven by lower expectations of Chinese capacity curtailments, Chief Financial Officer Bill Oplinger said on a conference call. China will add 2.8 million tons of production capacity this year, Alcoa said in the presentation.
The country already accounts for half of the world’s aluminum output and is on pace to export record amounts of products made from the lightweight metal this year.
The supply glut has depressed metal prices in recent years and prompted New York-based Alcoa to idle higher cost smelters and instead focus on the manufacture of more profitable aluminum components for the auto and aerospace markets.
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