The Price Of Aluminum Ingot Raw Materials Fluctuates
The most explosive thing in the aluminum industry recently is the fierce increase in aluminum prices, which rose by about 2,000 yuan/ton in just one month. Aluminum prices surged sharply in February. On the 25th, they broke through the 9-year historical high at the beginning of December. On the 26th, they moved down slightly and remained the second historical high in the past 9 years.
According to data from the National Bureau of Statistics, in December 2020, my country's electrolytic aluminum production was 3.268 million tons, an increase of 2.70% month-on-month, an increase of 7.60% year-on-year, and a year-on-year growth rate of 8.3 percentage points higher than the previous year. From January to December 2020, my country's cumulative production of electrolytic aluminum was 37.08 million tons, an increase of 4.90% year-on-year, and the year-on-year growth rate was 5.8 percentage points higher than the previous year. In terms of production costs, the average production cost of electrolytic aluminum this week was 13,531.16 yuan/ton, and the average profit of electrolytic aluminum was 2,168.84 yuan/ton, which was an increase of 526.38 yuan/ton from last week. The production cost of electrolytic aluminum this week was at the lowest level in 5 years, and the profitability of electrolytic aluminum was at the highest level in 5 years. Although the profitability of electrolytic aluminum is at a high level, the release of production capacity in Southwest China is not as good as expected. Overall, the growth rate of electrolytic aluminum supply is not as fast as the growth rate of demand, and the fundamentals of the aluminum market are on the high side.
On the other hand, the overseas epidemic has slowed down, and Lun Aluminum has strengthened, boosting Shanghai Aluminum; on the other hand, the release speed of domestic electrolytic aluminum production capacity has not been as fast as the demand recovery speed, resulting in social inventory accumulation that is less than expected. In addition, this year my country's "New Year in Place" initiative is expected to enable downstream companies to resume work and production quickly, and consumption may not be slow in the off-season.
These various reasons have led to a rapid rise in aluminum prices.