In the Near Future Backbone Aluminum Enterprises will Close Down About 2.4 million Tonnes of Capacity



In the Near Future Backbone Aluminum Enterprises will Close Down About 2.4 million Tonnes of Capacity

On August 21, China Nonferrous Metals Industry Association Aluminum Industry Branch assembled some backbone aluminum enterprises and Henan Nonferrous Metal Industry Association to hold a discussion meeting in Beijing over the current operation trend of aluminum industry, dilemma and opportunity ahead and measures to diffuse surplus capacity, the meeting also discussed the Development Guidance Opinion for the Aluminum Industry in the “Thirteenth Five Year Plan” (Draft). Chen Quanxun, counsellor of the State Council and President of China Nonferrous Metals Industry Association, Vice President Wen Xianjun, and Director of Aluminum Industry Branch Liu Xiangmin attended the meeting and delivered speech. Feng Meng, Deputy Section Chief of the Nonferrous Metal Section, Department of Raw Materials of MIIT, attended the discussion meeting. The meeting was presided over by Yang Yunbo, Deputy Chairman and Secretary-general of the Aluminum Industry Branch.

In his speech, Chen Quanxun said CNMIA attached great importance to aluminum industry development, and was particularly concerned with the current operation trend of the aluminum industry, especially under the current situation of sluggish aluminum price, and industry-wide loss, how to contribute concerted efforts to properly handle work in the aluminum industry needs wisdom from everyone. Chen Quanxun acknowledged efforts by the Aluminum industry Branch in organizing this discussion meeting, meanwhile he requested all enterprises to earnestly analyze the current dilemma, put forward measures to promote healthy development of aluminum market. Chen Quanxun repeatedly emphasized that aluminum is “green” product and energy-saving product with superior performance. It is necessary to change the existing capacity surplus situation, combine “dredging and blocking”, under the prerequisite of adhering to total volume control, continue to expand aluminum application, so long as everyone makes concerted efforts, and cherish confidence, the difficulty can be overcome.

In his speech, Wen Xianjun pointed out that if the aluminum industry wanted to walk out of dilemma, apart from winning over support from the state government and local governments for aluminum manufacturers, what’s more important is to expand aluminum consumption, shut down capacity with no market competitiveness and no prospect of reversing loss, resolutely phase out capacity not up to the “Regulatory Condition of Aluminum Industry” and capacity failing to reach standard after rectification.

Liu Xiangmin analyzed the dilemma and opportunities facing China’s aluminum today, and pointed out the aim of convening this discussion meeting is to listen to everyone’s analysis and judgment of the current situation, implement industry self discipline, study measures to diffuse surplus of aluminum capacity, create harmonious atmosphere of aluminum development, and promote healthy and orderly development of the aluminum industry.

After one day’s discussion, everyone agreed: Under the impact of multiple factors including downturn in China’s macro economy, anticipation of increase in USD interest rate, and capacity surplus, the future aluminum market still faces great pressure; nevertheless, as automobile light weight and rural urbanization construction continued to make progress, the construction of “One Belt One Road” project began to unfold, aluminum alloy new products continued development, and the propaganda effect of expanding aluminum application spread around, all these factors would continually increase consumption ability of aluminum. The meeting agreed that currently China’s aluminum industry is facing both dilemma and opportunities. Under the current new normal of China’s economic development, China’s aluminum industry is still trapped in interim surplus period. Diffusing aluminum surplus capacity, improving industry operation quality and expanding aluminum application are imperative.

Based on respective operation conditions of aluminum production lines, participating enterprises put forward detailed measures for adjusting and optimizing existing capacity, and strictly controlling newly added capacity. These measures included strengthening industry self discipline, permanently shutting down partial low-efficiency aluminum capacity with no hope of reversing loss, earlier overhaul of electrolytic cell etc in order to appropriately reduce output of aluminum and slow down production launching speed of newly added capacity etc. According to preliminary statistics, some participating enterprises recently closed down about 2.40 million tonnes of capacity.

All attending units expressed the intention to increase technology investment, actively develop new products and optimize product structure, promote consumption of aluminum products, support the “Green Aluminum Propaganda & Expanding Aluminum Application” work unfolded by the Association; meanwhile everyone also realized that in the current difficult situation, strengthening self construction, accelerating transition & upgrading, and bringing out market allocation role hold crucial importance for sustainable development of the industry.

Meeting attendants together called for relevant government departments to cancel temporary tariff for aluminum export as soon as possible, so as to fulfill integration of domestic and overseas aluminum market. Speed up enforcement of supporting policies related to electricity system reform, enable aluminum enterprises which are considered premium power users to enjoy reasonable electricity price, lower electricity usage wheeling cost, and share dividend of reform.

Targeting at the ‘Guiding Opinions for Development of Aluminum Industry in the “Thirteenth Five Year Plan” (Draft)’, attending delegates put forward some constructive suggestions.

This time’s meeting will help ease pressure of aluminum supply, and holds key significance for healthy development of the aluminum industry.