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Will the Reduction of the China’s Aluminum Factory Take the effects?

2015-12-16

Recently most of the China’s aluminum factories announced to decrease their production amount. The top 10 of China’s main Cooper smeller factory also addressed a declaration that they are going to decrease the Cooper production amount by 350 thousand MT. The same situation also happens in the Zinc industries in China. Similar with china’s aluminum factories, they also planned to cut down the production by 500 thousand MT. And the nickel factories also decided to cut the production by 20 percent, which nearly 80 thousand MT.

All these declarations suggest that after the huge drop of the international metal prices, China’s metal factories also facing the same pressure as the western factories. But it seems that the measures the these China’s aluminum factory trying to proceed is not that powerful as it looks like, and these measures will not help much to the solving of the main problems of the metals industries. The root of the current weak markets is due to China itself.

The other Medias doubt whether the China’s aluminum factories will perform their permits. They also doubt that how long these factories would keep the deduction actions. And these doubts are understandable.

In the past, the China’s aluminum factories would work together try to maintain the international aluminum price, but each time, the effects they creates were rather low. The production is till over the demands, the price drops, which happens no matter in China or in London But the problem is whether it is workable to reduction of the aluminum to stop the aluminum price dropping? Take the Nickel industries as samples. They also gave out detailed plans to reduce the production. Although these measures seem good, any way at the same time the steel industries in China also announced that they are going to cut down their productions. And the steel industries are the main customers of the Nickel industries. So in that way the deduction of the Nickel was neutralized by the Steel reduction.

The same thing happens in the Aluminum industries. Although the deduction of China’s Aluminum factories won’t influence the production of the aluminum mine productions, the mine production is the key to the aluminum supplies. So if China really wants to decrease the aluminum production they should focus on the aluminum mine productions.

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Henan Mingtai Al

Mingtai Aluminum

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