How shall aluminium companies counter the shaking aluminium price

How will be the aftermarket like and how shall aluminium companies counter the shaking aluminium price influenced by output cut initiation and levy on export of aluminium alloy? Three opinions as follows:

Aftermarket

From the perspective of policy, the country will go on strengthening export policy, trending for downstream products.

From the perspectiveof supply and demand, though speed of primary aluminium consumption in H1 exceeded speed of output increase, fall of primary aluminium consumption is striking.  

From the perspective of cost, average cost of electrolytic aluminium in the country is now close to 18000 yuan/ton, resulting from raise in energy resources, electric price as well as labor cost, capital cost, and supporting material prices.

In H2, therefore, increase rate of consumption will fall back, and the oversupply will not exert aluminium price in the country.

Counter the new situation

1. Practice industry self-discipline

The first task is to actively conduct national industry policy to disuse ineffective production capability, compress electrolytic aluminium investment.

2. Actively explore domestic market

The country¡¯s policy on electrolytic aluminium is set to meet the needs of domestic market which is still of high potential.

3. Strengthen publicizing of aluminium application  

Strengthen publicizing of aluminium application in energy saving, especially in public transportation.

All in all, electrolytic aluminium industry should conquer difficulties in business management, constrain excessive growth of output capability for the benefit of this industry.

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