Morning Bites (part 3)

🇨🇳China launched 1.1mnt of  aluminium capacity in April, including 212kt of newly added production, according to Shanghai Metals Market (SMM). On our numbers, the figure is equivalent to ~1.5% of world Al supply in 2023F, so this might have been weighing on the metal’s price in recent months. To recap, after the severe power shortages in 2021, Yunnan smelters were again forced to reduce Al production in late-2022 because of similar issues. Meanwhile, according to SMM, once the dry season is over and power supply shortages have been resolved, local smelters might resume another 2.6mnt of Al capacity and launch some 1.6mnt of new volumes (together representing ~6.0% of global Al output). Hence, were these risks to materialise, aluminium prices globally might be pressured, though achieving such outlook seems overly ambitious to us

#aluminium
https://metals-wire.com:3000/sector/Aluminium