China’s secondary aluminium operating rates down 4.2 percentage points YoY in May
According to Shanghai Metals Market, operating rates across Chinese secondary aluminium producers stood at 53.73% in May, down 4.6 percentage points from April, and 4.2 percentage points from May 2018.
Car inventory clearance ahead of the new emission standards kept demand for secondary aluminium weak. Inventories of finished products at secondary aluminium producers had grown on weak demand from end-users, and this drove them to curb production.
SMM reported that Inflows of seaborne ADC12 weighed on the domestic low-end market, and this shrank profit margins that producers could incur, resulting in production cuts.
In April, operating rates across secondary aluminium producers averaged 58.37%, down 3.05 percentage points month-on-month but up 0.05 percentage point year-on-year.
SMM expects the operating rates across secondary aluminium producers in China to extend their declines, to stand at 50% in June.
China's new restrictions on scrap import likely to raise cost for domestic secondary smelters and ADC12 alloy prices
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