China April aluminium output down 1.2% on prior month on power curbs

China April aluminium output down 1.2% on prior month on power curbs

China’s aluminium output in April fell 1.2% from March, data showed on Tuesday, as power curbs in the southwest limited production of the metal.

China produced 3.33 million tonnes of aluminium last month, down from 3.37 million tonnes in March, though that was up 0.8% compared with a year ago, according to data from the National Bureau of Statistics.

Output growth is being capped by ongoing issues in Yunnan province, China’s fourth biggest aluminium-producing province, with about 12% of the country’s total capacity.

Yunnan relies heavily on hydropower for power generation but has asked aluminium producers to cut production since last September amid low rainfall and water levels.

Average daily output for April of 111,000 tonnes was slightly higher than March levels of 108,710 tonnes, according to Reuters calculations.

However, constrained supply has lent little support to prices, with demand for the metal used in construction and transportation hit by a slower-than-expected economic recovery in China and sluggish exports.

The most-traded aluminium contract on the Shanghai Futures Exchange SAFcv1 averaged 18,440 yuan ($2,667.79) a tonne last month, down from 18,750 yuan a tonne in March.

May output is expected to rise slightly, said CITIC Futures in a recent note, with summer rain in Yunnan replenishing water levels in the province’s dams and increasing hydropower generation.

Capacity of 255,000 tonnes per annum also resumed last month, mostly in the southwestern Guangxi and Guizhou regions, according to a survey by information provider Mysteel.

For the first four months of the year, China produced 13.3 million tonnes of aluminium, up 3.9% from the corresponding period in 2022, the data also showed.

April production of 10 nonferrous metals – including copper, aluminium, lead, zinc and nickel – rose 6.1% from a year earlier to 6 million tonnes, according to the statistics bureau.

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