China’s domestic aluminium industry PMI records a fall of 1.5 percentage points but hovers above 50%

The Shanghai Metals Market survey found that in August 2023, the comprehensive PMI index of the domestic aluminium industry registered a fall of 1.5 percentage points M-o-M to 51.6 per cent, in line with the downtrend of production, demand, inventory and other indices. But despite the downfall, the PMI index hovered above 50 per cent for the third month in a row.

The primary reason for the PMI index drop in August was the slower recovery of demand from different sectors than expected. The domestic aluminium producers scheduled their production reasonably, and most companies procured raw materials only on demand.

PMI of aluminium products, including primary aluminium and secondary aluminium alloy also stayed above 50 per cent as the upcoming peak season brought slightly higher orders. Only the construction aluminium extrusion sector shrank below 50 per cent due to the lower demand in the real estate industry.

However, it is to be noted that although the PMI of the construction aluminium extrusion sector hovered below 50 per cent, it recorded a rise M-o-M from 45.2 per cent to 47.5 per cent. Similarly, aluminium wire and cable, primary aluminium alloy, and secondary aluminium alloy grew month-on-month by 2.96 percentage points, 8.93 percentage points, and 4.45 percentage points to stand at 52.2 per cent, 56.1 per cent, and 51.6 per cent, respectively.

The PMI of aluminium plate/sheet and strip and aluminium foil decreased by 11.83 percentage points and 6.98 percentage points M-o-M to reach 52.9 per cent and 53.3 per cent, respectively. Industrial aluminium extrusion, on the other hand, remained restrained at 54.1 per cent.

Source: SMM