Aluminum price is difficult to form a trend market

In July, the price of Shanghai aluminum showed a rebound trend in the middle of the month after the continuous decline at the beginning of the month. The price of Lun aluminum continued to fluctuate at the bottom.

Since July, the spot trend of domestic aluminum ingots has been basically synchronized with the futures price. The spot price of A00 aluminum in the Yangtze nonferrous metal market increased from 19230 yuan / ton at the end of June to 18020 yuan / ton on July 27, with a monthly decrease of 6.29%. LME spot aluminum prices in London are also basically consistent with LME's disk, showing a trend of bottoming out, and the overall situation is relatively weak. As of July 27, the spot price of Lun aluminum was 2390.5 US dollars / ton, with a monthly decrease of 0.27%.

According to the data of the General Administration of customs, in June, China's electrolytic aluminum export volume was about 66232.2 tons, a month on month decrease of 89.8% and a year-on-year increase of 87 times; The import volume of electrolytic aluminum was about 28502.8 tons, down 23.6% month on month and 82% year on year. In the first half of the year, China's total import of electrolytic aluminum was 197200 tons, with a year-on-year increase of 59.4%. In June, the export volume of unwrought aluminum and aluminum products was about 607400 tons, down 10.2% month on month and up 33.7% year on year. In the first half of the year, the export volume of unwrought aluminum and aluminum products was 3.509 million tons, with a year-on-year increase of 34.1%. In June, the export of alumina was 189200 tons, with a month on month increase of 0.21% and a year-on-year increase of 361.8%; Imported alumina was 138500 tons, with a month on month increase of 93.79% and a year-on-year decrease of 49.63%.

Electrolytic aluminum output is expected to continue to grow

Production capacity and operating rate have increased

According to SMM data, as of the beginning of July, the domestic electrolytic aluminum operation capacity reached 41.05 million tons, the effective built capacity was 44.57 million tons, and the operating rate of electrolytic aluminum enterprises was about 92.1%.

In July, Gansu Liancheng Aluminum Industry Co., Ltd., Guangxi Geely baikuang Aluminum Industry Co., Ltd., guangtou Yinhai Aluminum Industry Co., Ltd. and other projects resumed production steadily. New projects such as Gansu Zhongrui Aluminum Industry Co., Ltd. and Guangyuan Zhongfu Aluminum Industry Co., Ltd. were also put into production as planned, and the domestic electrolytic aluminum operation capacity continued to increase. By the end of July, the domestic electrolytic aluminum production capacity reached 41.4 million tons. In July, the domestic electrolytic aluminum output reached 3.48 million tons, a year-on-year increase of 6.2%.

In the first half of the year, the overall excess of alumina was 426000 tons. At present, the alumina market is in the replacement stage of new and old production capacity, and new market input and production reduction and shutdown may occur at the same time. In the early stage, the concern that alumina production capacity may be significantly excessive was alleviated.

According to Aladdin's data, the production capacity of electrolytic aluminum continued to decrease from the second half of 2021 and reached the bottom in November 2021. The dual control of energy consumption and the reduction of production caused by power shortage, which have plagued 2021, will also be gradually restored at the end of 2021. Since the beginning of this year, the domestic coal price has been regulated in an orderly manner, and the power consumption cost of electrolytic aluminum plants has been guaranteed to a certain extent. Although the power consumption preference of domestic electrolytic aluminum plants has been cancelled, the normal production can be effectively guaranteed. In addition, in the early stage, the production of aluminum plants in Europe was reduced, but the capacity of electrolytic aluminum was not further reduced.

According to the data of Baichuan information, as of August 4, China's electrolytic aluminum production capacity (calculated by the units with production capacity) was 47.097 million tons, and the commencement was 41.348 million tons. This year, the production reduction of electrolytic aluminum in China was 950000 tons. The total production scale of electrolytic aluminum in China is 4.102 million tons, of which 2.817 million tons have been restored, and 1.285 million tons are to be restored. It is expected that 1.065 million tons will be restored within this year. The new production capacity of electrolytic aluminum in China has been completed and is to be put into production. It is 3.105 million tons, and 1.66 million tons have been put into production.

According to the changes in the immediate profits of the electrolytic aluminum plant, 2021 was a profitable year for the electrolytic aluminum plant, but this situation came to an abrupt end in October last year. In the second quarter of this year, the profits of electrolytic aluminum enterprises shrank significantly. Recently, due to the continuous decline of aluminum price, the profits of electrolytic aluminum enterprises have also changed from positive to negative. According to the author's calculation, at present, about a quarter of the aluminum plants in the whole market are at the break even line or have lost money. As of July 27, the complete cost of the self owned aluminum plant was about 18161 yuan / ton, and the immediate profit was 141 yuan / ton; The complete cost of the online power aluminum plant is about 19387 yuan / ton, and the immediate profit is 1367 yuan / ton.

According to the statistics of Baichuan Yingfu, as of August 4, the built capacity of domestic alumina was 96.7 million tons, the operating capacity was 85.8 million tons, and the operating rate was 88.73%.

Aluminum ingot inventory is maintained to support aluminum price

Since the beginning of this year, the social inventory of aluminum ingots has been suppressed first and then increased. This year's accumulated amount of electrolytic aluminum is obviously lower than that of previous years. Affected by the epidemic, in March April, which should have been the traditional peak season, enterprises were forced to stop production and delay. Instead of going to the warehouse, the inventory accumulated slightly. The production and transportation of raw materials of processing enterprises have also been affected to a certain extent, and the aluminum ingot inventory has accumulated in the peak season. In May, with the improvement of the domestic epidemic situation and the hoarding fever after the sharp fall of aluminum price, the purchase demand of aluminum ingots increased again, and the inventory also entered the destocking cycle again.

At present, although the price of electrolytic aluminum is in a weak position, the inventory continues to decrease. In the second half of the year, especially from July to August, many enterprises began to take heatstroke prevention and cooling leave, and the inventory may be out of season. In addition, with the rise of the industrial park, the supply of molten aluminum will gradually squeeze the ingot quantity, thus shifting the focus of social inventory of aluminum ingots for a long time.

The real estate industry continues to be depressed

Last year, the real estate industry declined under the effect of policy regulation. However, due to the high new start-up data of enterprises in the past few years, there is still strong toughness, especially in the demand for aluminum materials. The construction aluminum profile operating rate in the first half of the year was significantly higher than that in the second half of the year. In the first quarter of this year, due to the unrelenting efforts of the real estate regulatory policies and the impact of the epidemic, the real estate market demand continued to bottom out. However, when the epidemic situation improves, the demand for aluminum will be boosted to a certain extent. It is expected that this year's aluminum demand will show a trend of low before high.

According to the latest data of the National Bureau of statistics, in the first half of the year, the cumulative output of aluminum profiles in China was 29.994 million tons, a year-on-year decrease of 2.8%. In the first quarter of this year, affected by the traditional off-season and the epidemic situation, the output of aluminum products decreased significantly. In the second quarter, it was low in the first quarter and high in the second. It is expected that the third and fourth quarters will be significantly improved.

Automobile production and sales increased sharply

In June, the production and sales of new energy vehicles in China increased rapidly, and the market penetration of new energy vehicles continued to rise. In the first half of the year, the cumulative penetration rate of new energy vehicles reached 21.6%. In the past year, the cumulative market penetration rate has steadily increased to 18.9%. The market recognition and competitiveness of new energy vehicles have been continuously enhanced. Since June, China's automobile industry has basically recovered from the impact of the previous epidemic. It is expected that in the second half of this year, the automobile industry will maintain a good growth trend, supported by the industrial cycle and policy.

In 2021, China's aluminum alloy output maintained a relatively good growth trend, and this year's performance is still bright. In June, the national aluminum alloy output was 1.044 million tons, an increase of 11.2% year-on-year. In the first half of the year, China's aluminum alloy output was 5.556 million tons, with a year-on-year increase of 8.9%. In the future, with the growth of automobile sales, the demand for automobile aluminum will continue to support the output of aluminum alloy.

In the first half of the year, the domestic electrolytic aluminum projects resumed production and the new production capacity gradually increased. The market supply increased, but the output growth was relatively slow. In July, some electrolytic aluminum projects were started and will continue to grow in the future. From the perspective of demand, the commencement of downstream processing enterprises has been differentiated. The operating rate of the upstream profiles and plates used in the real estate remained at a low level.

At present, it is the off-season of traditional consumption, and some enterprises have planned to take a holiday, so it is difficult to see a good demand side. From the perspective of export, as the ratio of Shanghai to aluminum fell again, the import window of electrolytic aluminum was closed again, which was conducive to export. In addition, foreign demand is poor, resulting in a decrease in the number of orders of export-oriented enterprises. The social inventory of aluminum ingots has accumulated slightly for two consecutive weeks, which has also formed a certain pressure on the aluminum price.

Recently, although the aluminum price has rebounded, the spot discount has continued to expand, which also shows that the downstream enterprises are not willing to receive goods, and the overall market sentiment is difficult to be optimistic. At present, the Shanghai aluminum market lacks a strong fundamental driving force. Therefore, it is greatly affected by the macro and unexpected events, while the macro factors are uncertain, and it is difficult for the aluminum price to form a trend market.