Chinese secondary aluminium operating rates continued to grow in September 2019

Shanghai Metals Market found that Chinese secondary aluminium producers, primarily in northern Chinese provinces, such as Hebei, Shandong and Henan, continued to ramp up operation in September for fulfilling orders in advance as they were required to close for up to 10 days around the National Day in early October.

SMM survey data shows the operating rates rose to 60.69 per cent in September, up 2.44 percentage points from August 2019 and 4.23 percentage points from the September 2018.

A rebound in downstream demand also helped drive the operating rates amidst overall low inventories of raw materials and finished products at secondary aluminium producers.

Also increasing orders at secondary aluminium producers in Chongqing in September triggered the rise in operation. Orders increased as downstream die casting mills started restocking after returned from August’s summer break.

Moreover, year-on-year increase in aluminium scrap imports by China in the third quarter guaranteed full operation at domestic producers that use imported scrap as feedstock.

SMM expects stability in orders that will keep operating rates flat across Chinese secondary aluminium plants in October.