Aluminium output rose of 10%

Aluminium production capability would increase 10% by the end of this year due to a large number of new constructions to operate, which will impact the already weak aluminium price.

Aluminium production capability in the following few months will increase 1500000T, mainly caused by aluminium plants¡¯ desire to pay off their debt.

China, in recent years, has been witnessing severest summer electric shortage, partly constrained many companies¡¯ plan for expansion. 

It was predicated earlier that China would increase 3000000 aluminium output in 2008 and the demand on this product would also rise; therefore, many aluminium producers were competing for this opportunity to make more profits. It was also predicated that China would realize 66% output increase in H2, but summer electric shortage postponed parts of the output to Q4.

Compared with July, spot aluminium of last week fell by 10% to 16900 yuan, a record low. Besides, LME data revealed that aluminium price fell 19%, another low for recent seven months.

Electric shortage and price slide forced 20 large aluminium companies, including Chalco, to agreed to cut their output by 10%.

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