Increasing Imports Amid Strong Demand
China, the world’s leading consumer and producer of aluminium, has witnessed a continuous rise in aluminium imports for the fifth consecutive month. In October, the country imported 351,065 metric tons of unwrought aluminium, including primary metal and unwrought, alloyed aluminium, according to the General Administration of Customs. This marks a 5.8% increase from September’s imports and a significant 78.7% rise compared to the same period last year.
Sector Demand and Domestic Supply Dynamics
The demand for aluminium in China remains robust, particularly from the new energy sector, even as traditional sectors experience constraints due to the country’s economic challenges. This sustained demand, coupled with concerns over potential reductions in domestic supply, has spurred increased imports.
Impact of Yunnan Province’s Power Curbs
Yunnan province, accounting for about 12% of China’s total aluminium production capacity, initiated cuts in aluminium smelter capacity in early November. These curbs, expected to last until April, have impacted around 1.15 million tons of capacity, intensifying fears of a domestic supply shortfall and driving the uptick in imports.
In the first ten months of the year, China’s aluminium imports amounted to 2.39 million tons, a 27.5% increase from the same period in 2022. Notably, imports of primary aluminium from Russia have seen a sharp 191% increase to 806,253 tons in the first nine months of the year.
Additionally, bauxite imports in October reached 11.1 million tons, up 24.7% year-on-year, reflecting continued strong demand for this essential raw material. Overall, bauxite imports for the January-October period totaled 117.7 million metric tons, marking a 13.7% increase from the previous year.
The rise in domestic production of primary aluminium to record highs, as reported earlier, indicates a response to the higher profits observed in smelting operations.