Rising costs continue to support the fundamentals of aluminum prices, aluminum enterprises are facing differentiation
In the stock continued to rise and to gradually implement the game under production, aluminum prices continue to rise, the market seems to be more supportive of the supply side behind the contraction, while the latter digest inventory optimistic. Into the September peak season of traditional consumption, investors may be concerned about the stock inflection point, whether to support the high prices of aluminum continue to uplink, while aluminum prices generally rebounded sharply, aluminum plate stock can continue to strengthen?.
Cost rise, electrolytic aluminum production decline
With the decrease of resource grade and environmental protection, the output of bauxite in our country has declined. Environmental protection regulations "Tianjin and surrounding areas 2017-2018 the comprehensive management of air pollution in autumn and winter assault action program" in addition to pre for alumina, electrolytic aluminum and carbon anode production motivation, also added to the requirements of mine. In this context, aluminum prices continue to rise. However, as the aluminum enterprises actively layout overseas bauxite and alumina market, together with the supply of Indonesian bauxite, the upstream bauxite supply will be adequate. Later, domestic bauxite supply will rely more on imports to supplement the domestic market.
Bauxite prices rose, the lowest price of aluminum, alumina prices rebounded significantly in mid August. Alumina mainly long single, throwaway amount is small, the cost side and higher profit rebound makes aluminum alumina prices strong space.
Domestic supply side reform to capacity is still under way, but the smooth production of foreign aluminum prices, July production increased slightly due to the number of days. In this case, the domestic aluminum price rises greatly, the superposition of the impact of RMB appreciation, Shanghai and London higher.
At present, statistics show that this year has shut down production can be about about 2000000 tons, the second half of the electrolytic aluminum market is expected to gradually become a gap, support prices higher.
At present, the illegal completion of electrolytic aluminum production capacity, if you need to continue production, you need to comply with the regulatory capacity producers to buy replacement indicators, taking into account the new production is less than expected at the beginning of the year, the latter will still have production through the replacement index release. Replacement indicators will increase the cost of new production enterprises, the current market price index is expected to be basically 2000 yuan per ton. Business profits have rebounded to about 3000 yuan / ton or so. If prices are maintained or rising, it is an important way for enterprises to maintain production and maintain profits if they consider purchasing replacement capacity.
The request of "Tianjin and surrounding areas from 2017 to 2018 in autumn and winter, the comprehensive pollution control crucial action plan", the heating season of electrolytic aluminum, alumina production enterprises more than 30%; carbon enterprises reach the emission limits in particular to full production; the special emission limit, limiting the production of more than 50%. Also increased the non-ferrous recycling industry, casting process, limiting production 50%. Discuss the supply side reform, whether the production reduction is superimposed with the heating season, if the stack, equivalent to 1 million 152 thousand tons of electrolytic aluminum production capacity, if not superimposed, equivalent to 3 million 622 thousand tons of electrolytic aluminum production capacity. In addition, the heating season, the shutting down of the capacity will resume production enterprises, expressed the need for corresponding profits will restore, otherwise, one is to restart the high cost, the two is the frequent shut down will affect the service life of the electrolytic tank.
Electrolytic aluminum spot stocks increased during the season
Downstream aluminum production is high, the growth rate to support electrolytic aluminum prices remain firm. September season for the traditional consumption, it is expected that the downstream orders will rise, it is necessary to observe whether the high aluminum prices can be transmitted to the downstream consumer. The export side, because foreign aluminum prices this year is strong, Shanghai unparalleled continued low in the first half of the year, while export orders increased, exports are expected to gradually improve. But with the August Shanghai challenge higher, also need to pay attention to the change of export.
Inventory, due to rising aluminum demand in the off-season, the downstream demand is poor, enterprises only just need to take goods, electrolytic aluminum spot inventory rise in season, it is worth noting. In addition, the domestic stock exchange continued to increase, there are signs of recovery in foreign stocks.
In summary, in September, electrolytic aluminum production will fall somewhat, while the downstream gradually entered the peak season of consumption, inventory is expected to occur inflection point, further supporting the strengthening of aluminum prices. As for the aluminum enterprises, the cost of electrolytic aluminum enterprises is facing the rising of alumina prices and the extrusion of anode carbon prices, or more favorable for enterprises with higher self-sufficiency rate of alumina.