Commodity Online
Barclays: Global aluminium-capacity closures now 1.3 million tons/year
Edited by : AL CIRCLE
2 min read
Barclays Capital calculates that announced aluminium-capacity closures around the world now total 1.3 million metric tons per year. This includes capacity of 292,000 tons which has not been producing since 2009, around 342,000 tons of non-price-related closures and 85,000 tons per year of delayed ramp-up.
According to Barclays, The most recent announcement is Norsk Hydro planning to cut capacity by a third at an 180,000-tons-per-yer smelter in Australia due to low prices. Most closures have been in the North American and European regions mainly due to high power costs and low prices.
“Cost inflation in the metals industry is structural, in our view, and energy cost inflation has hit power-intensive metals like Aluminium and Nickel severely. Indeed, both nickel and aluminum operating costs have risen at double-digit rates over the past couple of years,” Barclays added.
So far, most of the output cuts have been outside of China, with a high aluminium prices on the Shanghai Futures Exchange supporting production in the country at a higher cost level. Shanghai aluminium prices are currently trading at a $500-per-ton premium to the London Metal Exchange, although smelters will not get this full premium since the value-added tax is included in the SHFE price, Barclays concluded.
According to Barclays, The most recent announcement is Norsk Hydro planning to cut capacity by a third at an 180,000-tons-per-yer smelter in Australia due to low prices. Most closures have been in the North American and European regions mainly due to high power costs and low prices.
“Cost inflation in the metals industry is structural, in our view, and energy cost inflation has hit power-intensive metals like Aluminium and Nickel severely. Indeed, both nickel and aluminum operating costs have risen at double-digit rates over the past couple of years,” Barclays added.
So far, most of the output cuts have been outside of China, with a high aluminium prices on the Shanghai Futures Exchange supporting production in the country at a higher cost level. Shanghai aluminium prices are currently trading at a $500-per-ton premium to the London Metal Exchange, although smelters will not get this full premium since the value-added tax is included in the SHFE price, Barclays concluded.
Previous article
Aluminium companies' shares trade firm in a weak market; brokerages bullish on Hindalco, Nalco
Next articleQatalum represents Qatar's newest energy-related industry at 20th World Petroleum Congress
Grow with
AL Circle
_md.webp)
