China’s primary aluminium production in May stands highest since December: NBS

According to the data released by the National Bureau of Statistics, China’s primary aluminium production in May stood at 2.98 million tonnes, which was marginally up by 0.4 per cent from 2.967 million tonnes in April and the highest since December 2019. The launch of new smelting capacity and the incentive of higher prices kept supply levels high, resulting in a boost in production.

However, year-on-year, China’s aluminium output last month was down by 0.1 per cent, said the bureau.

With the latest production data, China’s aluminium output in the first five months of 2020 came in at 14.81 million tonnes, up 2.1 per cent from the corresponding period last year.

China’s aluminium production is still on the upswing even as analysts estimate the country to have imported the most primary aluminium in a decade in May due to an open arbitrage to London Metal prices, which made it cheaper to purchase overseas metal.

In mid-May, Yunnan Aluminium’s Wenshan smelter came online with a smelting capacity of 500,000 tonnes per year. Henan Zhongfu Industrial Co powered up a 125,000 tonnes a year production line in Sichuan last month.

Shanghai aluminium prices rose by 5.9 per cent over the course of May, as Chinese demand rebounded after lockdowns to contain the COVID19 spread. Prices are now comfortably above smelter break, standing above RMB 13,600 ($1,900) per tonne.

Meanwhile, the production of 10 nonferrous metals, including copper, aluminium, lead, zinc, and nickel, rose 1.1% from the previous month to 4.98 million tonnes in May. That was up 4.1% year-on-year and also the highest monthly total since December.