"Aluminum" hit a new high In mid-to-late April, the spot price of domestic standard aluminum ingots kept rising, breaking through 18,000 yuan/ton, hitting new highs repeatedly.
On April 30, the average price of domestic aluminum ingots in the East China market was 18,850 yuan/ton, a new high in the past ten years. In April alone, aluminum prices rose 9.11% in a single month.
Two rounds of policies are superimposed, and the industry's capacity ceiling is basically formed
In 2017, under the influence of supply-side reform policies, the outdated electrolytic aluminum production capacity gradually withdrew from the stage of history through replacement or elimination. The market for electrolytic aluminum compliant capacity ceiling is initially estimated to be around 44 million tons.
According to the news in early April 2021, relevant state departments have studied the "Implementation Plan for Carbon Peaking in the Non-ferrous Metals Industry" (hereinafter referred to as the "Plan") and are seeking opinions from industry associations and enterprises. The "Plan" initially proposes that the non-ferrous metal industry will strive to be the first to achieve a carbon peak by 2025, and strive to achieve a carbon reduction of 40% by 2040, which will be at least 5 years ahead of the national carbon peak time. "
The aluminum industry's carbon peak target will have a major impact on new capacity and the layout of existing capacity. The market predicts that the "ceiling" of electrolytic aluminum's compliant capacity of 45 million tons will gradually take shape.
Judging from the historical price of aluminum ingots, the price of aluminum ingots is affected by supply-side reforms. After reaching a high point in the second half of 2017, it gradually enters a downward period, from 16,000 yuan/ton in September 2017. , The lowest level appeared during the slump caused by the new crown epidemic in 2020. Aluminum prices once fell to around 11,200 yuan/ton, and then rebounded to 1,4000-15,000 yuan/ton. The shock bottomed out. In late November 2020, aluminum prices continued to strengthen again and broke through. The high position in 2017 opened up a new situation of repeated record highs. Although there has been a short-term correction, with the impact of carbon peak and carbon neutral policy news factors, coupled with the positive macroeconomic aspects such as capital market inflation expectations, the sentiment of the bullishness of bulk commodity prices is strong, and aluminum prices are rising.
Demand is expected to rise
The quarterly downstream aluminum output rose significantly year-on-year (special circumstances will have a certain impact in 2020). According to statistics, China's aluminum output in the first quarter of 2021 was 13.89 million tons, an increase of 31.1% year-on-year. Among them, China's total aluminum production in March was 5.367 million tons, an increase of 17.6% year-on-year.
Looking forward to the second quarter, the market expects that domestic aluminum ingot consumption demand will continue to improve seasonally. The underlying theoretical basis is mainly as follows: First, overseas markets, the European and American manufacturing industries continue to recover, and the demand for industrial products is picking up. Since April, the European and American aluminum premiums have reached the highest levels since June 2019 and May 2018 respectively; second, the April social inventory data of the domestic market shows that the current destocking is obvious, and the total inventory is low in the same period in recent years Under the influence of supply constraints, the spot market supply tightening is expected to strengthen.
The market rise in April is mainly based on factors
One is the expected strengthening of the "ceiling" of supply-side capacity. Affected by carbon peaking and carbon neutrality, the new capacity of the aluminum industry has been restricted in recent years. The market is expected to require policy requirements or strictly control the "ceiling" of 45 million tons of electrolytic aluminum production capacity. Recently, it is mainly manifested in Guizhou, Shandong and other places that have introduced banning electrolytic aluminum and other industries to increase production capacity projects in violation of regulations, and new capacity is limited.
Second, the demand side aluminum consumption side support is strong, and aluminum social inventories are relatively low year-on-year.
Third, the macroeconomic outlook such as inflation expectations in the capital market is positive, which has helped to make the financial attributes of bulk commodities more explicit.
The market outlook is expected
In summary, with high prices and high profits, the current domestic electrolytic aluminum plants are basically at full capacity, the operating rate growth is limited, and under the domestic carbon neutral target, as the Chinese aluminum industry accelerates the implementation of the carbon peak target, local With the promotion of the government's energy consumption "dual control" policy, as a high energy consumption industry, the capacity and output of electrolytic aluminum will be limited. Recently, domestic aluminum ingot inventories have shifted into a downward trend, and traditional peak consumption seasons have gradually emerged, which strongly supports aluminum prices.
