China’s aluminium production in April’23 dips 1% M-o-M due to ongoing production cuts in Yunnan

According to the National Bureau of Statistics, China's aluminium production in April 2023 (30 calendar days) fell 1.2 per cent month-on-month at 3.33 million tonnes. In March 2023 (31 calendar days), the output was 3.37 million tonnes, which brought the Q1 production to 9.8 million tonnes.

In the first four months of 2023, China produced 13.3 million tonnes of aluminium compared to 13.01 million tonnes during the same period last year. That reflected a year-on-year increase of 2.23 per cent.

China's monthly production fall in April '23 could be attributed to the ongoing production cut issues in Yunnan province, China's fourth biggest aluminium-producing province, accounting for 12 per cent of China's total capacity. As per the reports, lower production in Yunnan is not yet being countered by new or restarted capacity.

On the other hand, China's average daily aluminium output during April 2023 edged a 2 per cent rise month-on-month from 108,710 tonnes to 111,000 tonnes, showed Reuter's calculations.

The dip in China's monthly aluminium production and therefore constrained supply has lent little support to prices but offset by lower demand for the metal in the construction and transportation industries due to slower-than-expected domestic economic recovery and sluggish exports.

The most-traded aluminium contract on the Shanghai Futures Exchange averaged RMB 18,440 per tonne last month, down from RMB 18,750 per tonne in March.

In China, about 255,000 TPA of capacity was resumed in April, mostly in the southwestern Guangxi and Guizhou regions, according to a survey by Mysteel. So, the output in May is expected to rise slightly. Also, the expected summer rain in Yunnan replenishing water levels in the province's dams and increasing hydropower generation will likely boost the country's aluminium production.