Aluminium market review in China in Q1 2011

(China Aluminium Network) Domestic aluminum price rose in January and February. Chain link ratio gains were respectively 3.0% and 1.0%. Aluminium price declined by 1.3% in March to 16521 Yuan per ton. Shanghai average A00 aluminium ingot was 16616 Yuan per ton, chain link ratio rose 3.0% and 1.3% YoY.
First, Domestic aluminum price first rose and then slipped in Q1.

Secondly, domestic self-sufficiency rate of alumina enhanced obviously in Q1.

Thirdly, net electrolytic aluminium imports increased in Q1; aluminum alloy and net aluminum exports enlarged clearly. 

Fourthly£¬the growth rate of real estate sales slowed obviously; aluminum consumption for architectural decoration industries reduced.

Fifthly, car promotion policy quited; sales and production decline suppressed demand for aluminum.

Sixth, oil price increased; power cost increased, which seriously squeezed aluminum profit margins.

Seventh, “Carbon" trading forced a new round of energy consumption standards for aluminum industry to be implemented.

In sum, aluminum demand growth slowed in Q2 and raw materials cost couldn't support, which suppressed aluminium price to rise. Meanwhile, power cost and energy-saving and emmission reduction cost increased largely, which would bring serious challenge to some enterprises.

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