China's aluminum industry development status

Since entering the 21st century, China's aluminum industry has shown rapid development momentum. From 2000 to 2011, China's alumina production increased from 4.328 million tons to 34.478 million tons, and electrolytic aluminum increased from 2.794 million tons to 17.786 million tons, an increase of 6.87 times and 5.37 times, respectively. China has become a major producer and processor of aluminum. However, there are many problems in China's aluminum industry, such as excess capacity, high external dependence on raw materials, and high-precision processing technology still lags behind the world advanced level.

China's aluminum industry development status

1. Rapid development and overcapacity

China's aluminum industry has experienced a period of rapid development since entering the 21st century. From 2000 to 2011, the average annual growth rate of alumina and electrolytic aluminum production in China reached 21% and 18% respectively. The rapid development of the aluminum industry has ensured the demand for aluminum in the national economy. However, due to the excessive investment, the demand has been affected by economic slowdown and other factors that have not been able to grow. In recent years, there has been a serious surplus of aluminum industry capacity in China. It is estimated that by the end of 2011, the country's alumina production capacity has reached 52.2 million tons/year, electrolytic aluminum production capacity has reached 25.5 million tons/year, and aluminum production capacity has reached 32 million tons/year. Compared with the output, alumina and electrolytic aluminum in 2011 The utilization rate of aluminum and aluminum materials was only 65%, 70% and 87.5% respectively. In fact, the excessive development of the aluminum industry has caused aluminum supply to exceed market demand, aluminum prices have been depressed, and aluminum companies have experienced difficulties in operating.

2. Raw materials are heavily dependent on foreign countries

The total reserve of bauxite resources in China is close to 4 billion tons, but it still cannot meet the raw material needs of the domestic aluminum industry. In 2000, the output of electrolytic aluminum in China was only 2.794 million tons, and the self-supplied alumina ratio was 71%. However, the electrolytic aluminum production capacity is developing too fast and the alumina supply is in short supply. In 2004, alumina produced in China could only meet 49% of electrolytic aluminum production. In recent years, the increase in alumina production in China has increased the alumina self-sufficiency rate to 90% in 2011, and the import volume has decreased. At the same time, however, the problem of insufficient bauxite has been highlighted. From 2006 to 2011, China's self-produced bauxite mines can only meet about 40% of domestic demand. In 2011, China imported 45.23 million tons of bauxite and 1.88 million tons of alumina, and the foreign aluminum raw materials had 61.5% of foreign dependence.

3, the industrial structure tends to be reasonable

At present, many technologies in the aluminum industry in China rank the world leading level. From the perspective of electrolytic aluminum energy-saving technology, special-shaped cathode electrolyzers, new structural diversion tanks, and current efficient energy-saving control technologies are widely used; large pre-baked cells have become mainstream, and the world’s first 500-kA pre-baked cell has been in aluminum. Liancheng branch invested in industrial production. In 2011, the average power consumption of electrolytic aluminum in China was 13,900 degrees, which is close to the best level in the world. The concentration of the aluminum industry has greatly increased. At the end of 2011, the top ten companies in electrolytic aluminum production capacity accounted for 64.36% of the total production capacity. In the allocation of elements, electrolytic aluminum production also develops in the energy-rich and cheap western regions.

Analysis of future changes

1. Electricity price affects the cost of electrolytic aluminum

In the production cost of electrolytic aluminum, electricity and alumina are two large pieces. According to current market conditions, electricity accounts for more than 50% of total production costs, and alumina accounts for more than one-third. The long-term rise in electricity prices will put pressure on the operating costs of electrolytic aluminum companies.

2. Bauxite exporter policy

China's dependence on bauxite imports is high, and the supply stability of bauxite depends to a large extent on the bauxite exporter's policy. China's imports of bauxite are mainly from Indonesia, Australia, Fiji, Jamaica and other countries, of which Indonesia has the largest share, from January to August this year accounted for 75% of all imports. However, Indonesia's bauxite export policy has changed. Since May 1 this year, it has banned the export of unprocessed metal ores, including bauxite. Later, although some exports are permitted, a higher export tax is levied.

3. Domestic demand depends on economic conditions

As an important basic industrial raw material, aluminum is widely used in various fields of national economic construction, and the economic prosperity has a direct impact on domestic aluminum demand. At present, the construction, transportation, power, and machinery industries are the four pillar industries for domestic aluminum product demand, which account for 68% of the total demand. The economic conditions of the four industries are most important to aluminum demand. China's economic development rate has slowed since 2011, and within a relatively long period of time, China's domestic aluminum demand is unlikely to achieve rapid growth.

4. Protectionism influences aluminum exports

At present, China has become one of the major suppliers and suppliers of aluminum products in the world, but exports of aluminum products have been affected by the rise of trade protectionism in some importing countries. The United States has continuously launched anti-dumping investigations on China's non-ferrous metal products in recent years. India, Australia, Colombia, and Europe all set up anti-dumping and anti-subsidy measures against China's aluminum exports. The export of aluminum products in China has been affected, and this state has further development trend.

in conclusion

China's aluminum industry has achieved remarkable development results, but the problem of overcapacity is also more serious. The situation of supply exceeding demand has caused the price of products to decline, and aluminum companies have suffered serious operating losses. To solve this problem, the growth of domestic demand is an important direction, and the aluminum industry itself must also limit the growth of production capacity and moderately accelerate the elimination of excess capacity. At the same time, China’s aluminum industry must also continuously improve its technical level, strive to reduce costs in order to cope with rising energy prices, and make preparations for potential shortages of bauxite in its business strategy.