This Year will Witness a Peak Period of Alumina New Capacity Starting Production



This Year will Witness a Peak Period of Alumina New Capacity Starting Production

According to the latest data published by the National Bureau of Statistics on April 15, in March alumina output was 4.80 million tonnes, up by 15.4% on Y-o-Y basis. January -March alumina output was 13.97 million tonnes, up by 15.3% on Y-o-Y basis. Analysts said this year would mark a peak period of alumina new capacity being launched into production; scheduled capacity for launching would reach 5 million tonnes, up by 47% than the 3.40 million tonnes last year.

Beginning from the second half of 2014, because growth speed of demand from electrolytic aluminum factories is faster than growth speed of alumina supply, and domestic supply of alumina is strained, this year newly added capacity of alumina increased sharply. Analysts estimate that the year 2015 might become the last peak period of production launching for new capacity of electrolytic aluminum, this year newly launched capacity of electrolytic aluminum is estimated at 4.60 million tonnes, in 2016 it is expected to decline to 3.50 million tonnes, as restriction on newly added capacity of electrolytic aluminum unfolds, newly added capacity of alumina will also gradually slow down.

According to data of www.smm.cn, in 2014 China’s total alumina output is 51.61 million tonnes, up by 10.7% on Y-o-Y basis, especially beginning from the second half of 2014, as newly added capacity of electrolytic aluminum increases, newly added demand for alumina also increases, on the one hand newly added capacity of alumina is released, on the other hand some enterprises restored preciously idle capacity. As the growth speed of electrolytic aluminum capacity slows down, and the demand from real estate industry weakens, analysis estimated in the future annual growth of alumina total output will drop to round 5%.

Alumina price continues to receive the restraint of electrolytic aluminum price trend, currently aluminum price remained sluggish, analysts considered in the first half of this year there would be little chance to see alumina price rise, loss of electrolytic aluminum enterprises would continue, stock preparation cycle of alumina would be shortened, whereas alumina shrinkage exceeded expectation, these inventory will suppress alumina price. With the release of newly added capacity of electrolytic aluminum in the second half of the year, downstream demand is expected to bolster up alumina price.