China Aluminum Output Forecast Unchanged After Quake

Beijing Antaike Information Development Co. kept its forecast for China's aluminum production this year unchanged even after the country's most powerful earthquake in more than half a century.

Antaike maintained its projection for output at 15.1 million metric tons and for consumption at 14.64 million tons, chief analyst Wang Feihong said by phone from Beijing today. Production was 12.3 million tons last year, according to the National Bureau of Statistics.

China's 7.9-magnitude earthquake halted production at a 120,000-ton a year aluminum smelter in the Aba region, located in the epicenter of the quake in Wenchuan county. The temblor killed more than 34,000 people, leveled 4.7 million houses in Sichuan, Gansu and Shaanxi provinces and damaged power stations.

``The Aba aluminum smelter was small and the overall impact on production is very limited,'' Wang said. ``Rebuilding of homes after the earthquake will boost demand, but it is difficult to give an estimate.''

Aluminum is used in window frames for homes. The earthquake regions are mostly rural areas, and aluminum is not widely used in homes there, Wang added.

Qiya Aluminum Co.'s 150,000-ton a year smelter in Sichuan province is running normally, said Huang Hong, vice president, in a phone interview from Sichuan today.

Sufficient Inventories

Alumina supplies through the Baocheng railroad account for half its raw material needs and stockpiles are ``enough'' to maintain operations, said Huang. The plant is located 160 kilometers (100 miles) southeast of the quake's epicenter.

``Power supply is not a problem at this stage,'' Huang said. Power makes up a third of aluminum production costs and two tons of alumina are used to make a ton of aluminum.

Sichuan Guangyuan Aluminum Co.'s 120,000-ton smelter in Sichuan is running normally and no output is likely to be lost, Liu Wei, general manager at the company, said in a phone interview today.

``The production facility was very slightly damaged and production was halted for a few hours just after the earthquake because of a power outage, but we are not expecting any loss of output from that,'' Liu said.

Sichuan Aostar Aluminum Co., the largest producer of the metal in the province, only had enough stockpiles of alumina to feed its plant for 10 days, Tang Yan, an operational manager, said by phone May 16. A hydropower shortage may worsen, he said.

Aostar has two plants, each with a capacity of 125,000 tons. The company relies on hydropower to run its operations and buys alumina material from Aluminum Corp. of China Ltd. The main Baocheng railroad was disrupted, cutting a third of Aostar's alumina supply of 22,000 tons a month for one of its plants, said Tang, who runs one of the smelters.

Aluminum for August delivery fell 0.3 percent to close at 19,280 yuan ($2,763) a ton on the Shanghai Futures Exchange at 3:00 p.m. local time. Aluminum for three-month delivery declined 0.3 percent to $2,985 a ton on the London Metal Exchange at 6:25 p.m. Singapore time.

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