Production cuts landing, aluminum prices resist the pressure!

The strength of the dollar index weighed on the trend of commodities, non-ferrous metals generally fell. Domestic electrolytic aluminum inventory decreased for the first time after the holiday, and the expected production cut in Yunnan region combined with the end of electrolytic aluminum inventory, aluminum prices stopped falling and stabilized. Follow-up aluminum prices are expected to maintain a volatile trend, the domestic reference range: 18200-20000. Overseas reference run range: $2300 - $2600.

1. Power cuts and production cuts, surplus balance sheet has been changed.

In January 2023, the domestic output of electrolytic aluminum was 3.418 million tons, down 0.6% month on month and up 6.7% year on year.Average daily production decreased by 642 tons month-on-month to 110,300 tons/day. In January 2023, the domestic electrolytic aluminum operating capacity fell, mainly due to the power shortage in Guizhou from December to January. After three rounds of power cutting and production reduction, the provincial electrolytic aluminum operating capacity at the end of January decreased by 760,000 tons compared with the end of November, and 310,000 tons compared with the end of December. In January, a small amount of production resumed in Sichuan and Guangxi, with a total production capacity of about 50,000 tons. The newly put into production in Gansu Zhongrui, Guizhou Yuanbo and Baiyinhua totaled about 120,000 tons.

2.

Inventory inflection point appears, the end of the tired library!

On February 16, 2023, SMM statistics the domestic electrolytic aluminum ingot social inventory of 1.216 million tons, an increase of 26,000 tons compared with last Thursday, and a decrease of 0.2 million tons compared with last Monday. This is an increase of 177,000 tons from February last year. On January 19 before the Spring Festival, the accumulated inventory increased by 472,000 tons. Electrolytic aluminum ingot inventory turning point this week, this Thursday inventory has declined compared with Monday, and compared with last week, although the inventory still increased, but the increase rate is significantly slower. In addition, aluminum rod inventory began to decline for two consecutive weeks, with the latest inventory of 202,300 tons this week, down 12,100 tons from last week's inventory.

3.

New energy vehicles continue to explosive growth, demand for spring

In terms of import and export, the import of primary aluminum fell sharply year-on-year. According to data released by the General Administration of Customs of China, China's raw aluminum imports in December 2022 were about 127,645.601 tons, of which 47.994 tons were imported under tariff code 76011010 and 127,597.607 tons were imported under tariff code 76011090. Primary aluminum imports in December 2022 increased by 15.3% month-on-month and 55.2% year-on-year. The cumulative total of domestic primary aluminum imports in 2022 was 668,000 tons, down 58 percent year on year. China's raw aluminum exports in December 2022 amounted to about 677.3 tons, of which 428.138 tons were exported under tariff code 76011010 and 249.125 tons under tariff code 76011010. Primary aluminum exports in December 2022 fell 71.7% month-on-month and 8.2% year-on-year. In 2022, the total accumulated domestic primary aluminum exports amounted to 196,012.8 tons, a year-on-year increase of 26.80%.

In 2022, new energy vehicles continued explosive growth, with the production and sales of 7.058 million and 6.887 million, respectively, up 96.9% and 93.4% year on year, and the market share reached 25.6%. In 2022, the production and sales of automobiles were 27.021 million and 26.864 million, respectively, with year-on-year growth of 3.4% and 2.1%. Compared with the previous year, the output was rapidly flat and the growth rate of sales decreased by 1.7 percentage points.