According to SMM statistics, domestic aluminium production in July 2025 (31 days) increased by 1.05 per cent Y-o-Y and 3.11 per cent M-o-M. The operating aluminium capacity in China increased slightly M-o-M in July, mainly due to the start-up of the aluminium Phase II replacement project in Shandong-Yunnan. Due to the strong off-season atmosphere in the end-use market, alloy production in various regions decreased significantly. As a result, the proportion of liquid aluminium in domestic aluminium smelters in July declined significantly, with the industry's proportion of liquid aluminium sliding 2.06 percentage points M-o-M to 73.77 per cent. Based on SMM's data on the proportion of liquid aluminium, it is estimated that the domestic casting aluminium ingot volume in July decreased by 9.34 per cent Y-o-Y and increased by 11.89 per cent M-o-M to approximately 976,300 tonnes.
Capacity Changes: As of the end of July, SMM statistics showed that the existing aluminium capacity in China was approximately 45.69 million tonnes (SMM adjusted the figure in late April by eliminating double calculations after taking into account capacity replacement and old plant dismantling). The operating aluminium capacity in China was around 43.9 million tonnes. Due to the commissioning of capacity replacement projects, the industry's operating rate increased slightly M-o-M. Additionally, a small batch of capacity that underwent technological transformation in Chongqing resumed production.
Production Forecast: Entering August 2025, the operating aluminium capacity in China remained at high levels. The second batch of replacement projects in Yunnan commenced production and achieved output, leading to a rebound in the industry's operating rate. Regarding the proportion of liquid aluminium, currently, only a few enterprises have indicated that they will continue to increase casting ingot production in August, mainly due to weak end-use demand, lower processing fees for alloyed products, and enterprises' pessimistic expectations for August demand, leading to expectations of further production cuts. This has forced aluminium plants to increase casting ingot production. It is expected that the proportion of liquid aluminium will remain at low levels, with limited downside room. Subsequent attention should still be paid to changes in end-use demand and the trend of the proportion of liquid aluminium.
Note: This article has been issued by SMM and has been published by AL Circle with its original information without any modifications or edits to the core information.
Responses
