Shanghai Metals Market found that slow expansion of domestic aluminium capacity led to an oversupply of pre-baked anode in China. This, together with higher overseas prices of pre-baked anode, drove exports of the material higher on a yearly basis in 2018.
In October, China exported some 128,000 tonnes of pre-baked anode, up 53.9 per cent from a year ago. This brought in the total pre-baked anode exports from China during January-October at 1.03 million tonnes, up 23.1 per cent from the contemporary period last year, showed data by China Customs.
The growth of domestic aluminium capacity slowed to below 5 per cent in the recent three years, with a negative increase of -2 per cent in 2017. However, the capacity of pre-baked anode maintained a growth rate of around 5 per cent.
After a great winter cut in 2017 that slashed the pre-baked anode capacity and grew worries in the market, the capacity this year expanded to some 1.4 million tonnes. Lesser impact of 2018/2019 winter cuts on pre-baked anode plants also accounted for expanded capacity this year.
Export prices of pre-baked anode, up to 1.2 times of domestic prices in 2018, also pushed exporters to move cargoes into international markets, SMM learned.
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