Chinese secondary aluminium operating rates in February estimated to fall to a record low: SMM
According to Shanghai Metals Market survey, secondary aluminium operating rates in China are likely to fall to a record low of 33 per cent in February, primarily due to a week or two delays in production resumption and the slow return of workers and downstream demand after the Chinese New Year Holiday because of Coronavirus outbreak.
Due to the virus outbreak, only a few major secondary aluminium producers could begin operations on February 10, while most of the other producers are likely to resume not before the 18th of the month.
In January as well, Chinese secondary aluminium producers reduced operations due to a holiday lull. Large-scale producers were mostly closed after January 20, while medium-scale and small plants had put production on halt between January 10 and January 15.
SMM data showed the operating rates across Chinese secondary producers were down to 41.8 per cent, 24.2 percentage points lesser month-on-month and 13 percentage points year-on-year.
The average working days for secondary aluminium producers were below 20 in January, which, along with frontloading downstream demand before the CNY Holiday, kept the overall operating rate below two-thirds of the normal level.
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