Welcome to Shanghai Changyu Copper Co., Ltd.
Shanghai Changyu Copper Co., Ltd.
CONTACT US
Shanghai Changyu Copper Co., Ltd.
Contacts:Ms.Ella
TEL:86-037963959009
E-mail:Online@cycopper.com
current location:HOME > NEWS > Common problems

Common problems

Aluminum Industry Benefits Overall Turn Loss into Profit Pressure
Release time:2019-05-10Browse times:39

Abstract: Demand has not yet substantially improved, and the Sino-US trade agreement has not yet been reached, and the pressure of turning losses into profits still exists.


The monitoring results of the prosperity index of the medium-colored aluminium smelting industry show that in March 2019, the prosperity index of the medium-colored aluminium smelting industry was 31.4, which generally continued last month's trend and maintained running along the "slightly cooler" range, while the leading composite index was 65.7, which continued to show a slight decline trend. In the past 13 months, the prosperity index of the medium-color aluminum smelting industry is shown in Table 1. In March 2019, the total production of the aluminium smelting industry was stable, the consumption of aluminium was better than expected, the stock of aluminium society decreased, the supply pressure eased, and the price of aluminium recovered. However, in view of the resumption of peak production capacity in the heating season, the demand has not been substantially improved, and the Sino-US trade agreement has not yet been reached, and the pressure of turning the loss into profit remains.




Prosperity index continued at last month's level




The monthly prosperity index of the medium-colored aluminium smelting industry shows that in March 2019, the prosperity index was 31.4, which was the same as in February, indicating that the industry is still in the adjustment stage because of internal and external troubles and insufficient momentum for recovery. The monthly prosperity index trend of the medium color aluminum smelting industry is shown in Figure 1.




As can be seen from the prosperity signal lamp of the medium-color aluminium smelting industry (see Table 2), in March 2019, of the 10 indicators constituting the prosperity index of the aluminium smelting industry, eight indicators, such as LME aluminium settlement price, M2, total investment in aluminium smelting, sales area of commodity houses, aluminium output, main business income and total export of aluminium materials, continued to be in the "normal" range; and two indicators, such as power generation and total profit, remained in the "normal" range. The index is in the "cold" range.




Ahead Composite Index continues to decline slightly




Since 2019, the leading composite index of the medium-colored aluminum smelting industry has continued to decline, but the decline is limited. In March, it fell by 0.9 points to 65.7. The synthetic index curve of the medium-colored aluminum smelting industry is shown in Figure 2.




Figure 2 Composite Index Curve of Colored Aluminum Smelting Industry




Among the five indicators composing the leading composite index, the annual change was 2 to 3 litres, of which LME aluminium settlement price and commercial housing sales area decreased by 11.4% and 1.6% respectively. The ring-to-ring ratio decreased by 2 and 3 litres, with LME aluminium settlement price and power generation falling by 1.2% and 0.1%, respectively.




Operation Characteristics and Situation Analysis of the Industry




In March 2019, due to the release of incentive signals such as tax cuts and fee cuts by the CPPCC and the positive promotion of Sino-US trade negotiations and other domestic and foreign policy environment, the operation of the aluminium industry is generally stable, as follows:




First, supply pressure has decreased. In March 2019, the decline in the operational capacity of electrolytic aluminium in China was mainly attributed to the rapid decline in the center of gravity of aluminium price since the beginning of the year, the accumulated loss of the industry in the first two months exceeded 1.3 billion yuan, and some production lines were shut down. At the same time, with the transfer of production capacity of electrolytic aluminium from Henan to Sichuan and other places, the original production lines withdrew; in addition, the production capacity of staggered peak production in heating season has not been restored completely It is preliminarily estimated that by the end of March 2019, the operating capacity of electrolytic aluminium will be about 36.2 million tons, and the output of electrolytic aluminium in March will be 2.88 million tons, an increase of 3.4% over the same period last year.




Second, aluminium consumption is better than expected. Although the holidays of aluminium processing enterprises during the Spring Festival holidays in 2019 were longer than last year, the output of aluminium materials in the country increased by 4% in the first two months, and the social stock of aluminium decreased by 70,000 tons in March. In terms of domestic consumption, although the current data performance in the main downstream areas is still low, the policy hedging effect is gradually emerging. In the first three months, the monthly output of automobiles decreased by 12.5%, 17.4% and 2.7% respectively, and the decline in March was 14.7 percentage points narrower than that in the previous month. In the first three months, the completed area of houses decreased by 10.8% and the newly constructed area of houses increased by 11.9%. In terms of export trade, despite frequent trade frictions, the export of aluminium materials has been growing rapidly since this year. In the first three months, China exported 1.44 million tons of unwrought rolled aluminium and aluminium products, an increase of 13.6% over the same period last year. Among them, the export of 550,000 tons in March reached a new high in the year. Considering the complex and changeable trade environment, the situation of aluminium export is still grim.




Third, domestic aluminium prices have risen slightly. In March 2019, there was a slight rebound in the price-to-ring ratio of aluminium at home and abroad. Among them, LME spot and March futures prices were $1872/ton and $1895/ton respectively, up 0.7% and 0.5% year-on-year respectively; Shanghai Aluminum spot and March futures prices were 13686 yuan/ton and 13695 yuan/ton respectively, up 1.5% and 1.1% year-on-year respectively. In March, the profit of electrolytic aluminium enterprises rebounded and the loss of the industry narrowed. Domestic alumina prices continued to decline, with spot prices falling by 2.5% to about 2700 yuan/ton in March, making it difficult for the industry to operate.




In summary, combined with the change of economic and trade environment at home and abroad and the expectation of policy adjustment, it is preliminarily predicted that the operation of the aluminum smelting industry will rise steadily in April 2019, and it will be running along the "cold" section.



86-037963959009
  • Shanghai Changyu Copper Co., Ltd.

    WeChat