Analysis of the development status of Chinas aluminum industry in recent years

For the development status of China's aluminum industry in recent years, Zhuochuang summed up five points from different angles: 1. The investment in the aluminum industry has gone out of the “cold winter period”, and the investment has occupied the advantage of the non-ferrous sector; 2. The scale of the aluminum industry continues to grow, and the growth rate is gradually released. 3. The aluminum industry will develop synergistically, and the “coal-electricity aluminum processing” will be integrated; 4. The implementation of the policy will be “sounding”, and the elimination of backward production capacity will be effective; 5. The era of electrolytic aluminum profit has passed, and the low price of aluminum is running. .

The first point: the investment in the aluminum industry has come out of the “cold winter”, and investment has taken advantage of the colored sector.

It should be said that in the past few years, under the background of rising external environmental risks, China's non-ferrous metal industry investment has been affected, and investment growth rate has been declining. In 2016, China's non-ferrous metal industry (including independent gold enterprises) completed fixed assets investment of 668.73 billion yuan, maintaining a negative growth year-on-year (see Figure 1). In comparison, China's aluminum smelting industry's investment performance has been stable and good. In 2014, China's aluminum smelting industry's fixed asset investment growth rate reached the bottom (see Figure 2). By 2016, the profitability of China's non-ferrous metal mining and smelting has improved significantly. In the same year, the profits from non-ferrous metal mining and smelting increased by 34.1% and 133.6% respectively.

The second point: the scale of the aluminum industry continues to grow, and the growth rate is gradually slowing down.

According to Zhuo Chuang monitoring data, the average annual compound growth rate of China's electrolytic aluminum production capacity in 2008-2016 was 12.53%. The average annual compound growth rate of China's alumina production capacity in 2008-2016 was 11.87%, both exceeding 10%.

From the trend analysis, China's electrolytic aluminum production capacity and alumina production capacity growth have gradually slowed down in the past decade. According to Zhuo Chuang data, China's electrolytic aluminum production capacity growth rate reached 30.8% in 2008. Since 2014, China's electrolytic aluminum production capacity has basically stabilized and returned to 10%; in 2011, China's alumina production capacity growth rate reached 26.2%, and the surge time The point is obviously later than the electrolytic aluminum industry; since 2013, China's alumina capacity growth rate has dropped back to single digits, and the rate of capacity expansion has slowed significantly (see Figures 3 and 4).

The third point: the coordinated development of the aluminum industry, the integration of "coal and aluminum processing".

From the analysis of resource factors affecting the development of the aluminum industry, Zhuo Chuang believes that electricity or coal, aluminum ore, alumina raw materials, aluminum processing and ports can be regarded as important resources that affect the future development of industry enterprises and regions. From the "Northeast-Southwest" line, China is divided into "upper left zone" and "bottom zone". It can be seen relatively clearly that the northwest region has obvious power or coal advantages, while the east and southwest regions are in aluminum. It has an absolute advantage in mining and alumina raw materials, aluminum processing and ports. Natural resources determine the structure of the location industry development.

According to Zhuo Chuang statistics, as of the end of 2016, China's top ten aluminum companies' electrolytic aluminum industry concentration reached 69.7%, of which China Hongqiao, Chinalco and Xinfa Group occupied the top three. From the monomer point of view, most of the group's electrolytic aluminum production capacity accounts for 2.5%-6% of the country. In the layout of electrolytic aluminum industry, the group-style development is relatively balanced.

The fourth point: the implementation of the policy is “sounding and sounding”, and the elimination of backward production capacity is effective.

In recent years, the state has made great efforts to resolve excess capacity, and there are many policies or events involving electrolytic aluminum. Especially in 2013, a series of policies were announced one after another and the national leaders voiced their efforts to curb the blind expansion of industries with severe overcapacity. The Notice on the Implementation of the Ladder Electricity Price Policy for Electrolytic Aluminum Enterprise Electricity, which was announced in December 2013, has attracted the attention of both inside and outside the industry. It is stipulated that the price of electricity for electrolysis in aluminum industry will be linked to the electricity consumption of electrolytic aluminum in electrolytic aluminum enterprises, which will force the production capacity of electrolytic aluminum to delist.

Zhuo Chuang statistics, in 2010-2016 China's electrolytic aluminum elimination of backward production capacity reached 2.78 million tons, of which the elimination of electrolytic aluminum backward production capacity of 504,000 tons in 2014, accounting for 1.39% of the total proportion of the year, the implementation of the policy implementation "sound" (see figure 5).

The fifth point: the era of electrolytic aluminum profit has passed, and the aluminum price is running at a low level.

In the past six years, China's electrolytic aluminum industry is not in sight, and the industry is basically at a loss. In 2014 and 2015, the largest loss of tons of aluminum reached 2,300 yuan, and the whole industry fell into a “cold winter” (see Figure 6). Although benefiting from supply-side reforms, aluminum prices bottomed out, and most aluminum companies gradually stepped out of “losing money and smog” to realize profits, but it is not easy to seek profiteering.

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