China\'s aluminum industry is facing a severe test

    According to customs statistics, from January to July, Ningbo Port exported 133000 tons of unforged aluminum and aluminum materials, an increase of 39.8 percent over the same period last year; the value of 0.41 billion billion U.S. dollars, an increase of 45.4 percent; the average export price was 3104 U.S. dollars per ton, an increase of 4 percent. Its exports are mainly characterized by the following characteristics:

1. to the general trade mode of export-oriented, processing trade mode of export growth rapidly. From January to July, Ningbo Port exported 120000 tons of aluminum under general trade, an increase of 35.2, accounting for 90% of the total exports during the same period. During the same period, 13000 tons of aluminum were exported through processing trade, an increase of 99.6.

2. private enterprises and foreign-invested enterprises are the main export force, and the export of collective enterprises has increased significantly. From January to July, private enterprises at Ningbo Port exported 95000 tons of aluminum, an increase of 43.1 percent, while foreign-invested enterprises exported 31000 tons of aluminum, an increase of 47.4 percent, accounting for 94.5 percent of the total exports in the same period. State-owned enterprises and collective enterprises followed, respectively, the export of aluminum 4887 tons and 1316 tons, respectively, an increase of 10.1 and 1.7 times.

3. the EU, Nigeria, ASEAN and Japan are the top four export markets. From January to July, Ningbo Port exported 22000 tons, 12000 tons, 10000 tons and 9985 tons of aluminum to the European Union, Nigeria, ASEAN and Japan respectively, an increase of 67.9, 1.6 times, 64.5 and 96.4, accounting for 40.9 of the total exports in the same period. Exports of aluminum to South Korea 9945 tons, down 14.4; exports to the United States 8734 tons, an increase of 1.2 times.

With the gradual improvement of the economic situation in Europe and the United States, the external market demand has increased. The latest LME aluminum inventory was 4411175 tons, down 9000 tons from the previous trading day. The reduction in LME aluminum inventories has supported aluminum prices to some extent. With the country\'s restrictions on the export of two highs and one capital Products, the export of domestic aluminum industry has begun to face many tests. Mainly in the following three aspects:

1. China\'s aluminum industry overcapacity. China\'s aluminum production in the first two months increased by 46% over the same period last year, significantly higher than the 36% increase in the production of finished aluminum Products in the same period. Standard Chartered Bank stated in a recent research report that my country\'s excessive aluminum production has led to a weak local market, and it is expected that my country\'s aluminum supply will exceed demand in the next few years. At the same time, the Chinese government holds about 590000 tons of aluminum inventory due to the storage plan, and the provincial government also holds a considerable amount of inventory. In the unilateral rise of Shanghai aluminum in 2009, many aluminum smelting enterprises started to produce and stock up, resulting in the continuous rise of aluminum ingot inventory, while the private inventory was also too high. According to the survey, there are 300000 tons of aluminum ingots in stock in Guangdong. There are 200000 tons in northeast China. Shanghai, Hangzhou, Wuxi and other places have a total of 800000 tons of aluminum ingots.

The wind of 2. trade protection is rising again. Since the outbreak of the global financial crisis, foreign trade protectionism has been on the rise, and a series of anti-dumping cases against China have occurred one after another. Since 2007, from South Africa, Canada, to Australia, the United States, and Turkey, Chinalco has frequently encountered multiple double reverse investigations, and the high tariffs have overwhelmed companies. For example, on April 21, 2010, the US Department of Commerce announced that it had decided to initiate an anti-dumping and countervailing investigation on aluminum profiles imported from China, with a preliminary countervailing ruling of 137.65 per cent. Affected by this, the domestic aluminum industry has shifted its focus to the domestic market.

3. three mountains squeezed the profit space of aluminum enterprises. Electricity and alumina, as the two most important costs of electrolytic aluminum, are on the rise. In the first five months of this year, due to the continuous low operation of electrolytic aluminum prices and the impact of rising costs, aluminum smelting enterprises (including electrolytic aluminum and alumina) realized profits of 5.2 billion billion yuan, down 23.6 percent from the same period last year. Industry profitability is not optimistic. At present, the aluminum industry only earns processing fees, and the industry\'s profits are mostly between 8% and 10%. In the past two years, the cost of electricity has increased by more than 10%, and the labor cost has increased by more than 20%. In addition, the exchange rate has risen, and the profit margins of aluminum companies have been further squeezed. Rising exchange rate, energy and labor costs have become the three mountains on aluminum companies .

Therefore, it is suggested that: first, we should keep abreast of the policy changes in the international aluminum market, establish an overall trade development strategy, and help enterprises actively deal with various foreign trade barriers. Second, the use of domestic low-grade bauxite and resource reuse, to encourage aluminum enterprises to accelerate the exploration and development of bauxite overseas. The third is to speed up the optimization of the industrial structure of the aluminum industry, further improve the industrial concentration, improve the market competitiveness of Products, and encourage enterprises to develop in the direction of collectivization, large-scale, specialization and branding. The fourth is to focus on supporting the export of high-performance, high-tech and high-value-added deep-processed Products, increase support for technological innovation of aluminum enterprises, encourage and guide enterprises to actively promote energy-saving technological transformation, further reduce costs, and improve the core competitiveness of enterprises.