Chalco H1 aluminium Output Falls more than 8% as Prices Sag

Reuters reported that Chinese aluminium giant Chalco’s production of the metal fell more than 8% in first-half 2019 from the same period a year earlier highlighting the impact of low prices on Chinese smelters. Chalco said that primary aluminium output was 1.89 million tonnes in January-June, down from 2.06 million tonnes a year earlier. The firm disclosed the drop in a presentation to analysts, reviewed by Reuters, the day after reporting a slide in first-half profit. That output level was just ahead of Russian rival Rusal , which produced 1.87 million tonnes in the first half, but below Chinese private-sector competitor China Hongqiao Group’s 2.86 million tonnes. China is the world’s biggest producer of aluminium.

Chalco’s production of alumina, the substance used to make aluminium, rose 3.2% year-on-year to 6.82 million tonnes, according to the presentation.

The company did not immediately confirm numbers contained in the presentation, which also showed Chalco’s average aluminium sales price in the first half was 13,778 yuan (USD 1,942.53) a tonne, down 4.4% from a year earlier.

Shanghai aluminium prices struggled to move away from two-year lows in the first six months of 2019. That led smelters to reduce output in a bid to cut losses and prices are now up to around 14,300 yuan after flooding at Hongqiao’s premises earlier this month and a separate outage in Xinjiang.

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