NBS: China's Jan-Aug primary aluminum output up 2.2% YoY

For August alone, China produced 3.8 million tonnes of primary aluminum, down 0.5% on year, the NBS data found. This result was 0.5% higher than July, Mysteel Global calculated based on the NBS statistics.

"Last month, rising costs, combined with a slight retreat in aluminum prices, squeezed smelters' profit margins to some extent, though profitability remained relatively high," an industry source noted.

The smelting costs of the 102 primary aluminum smelters that Mysteel monitors nationwide averaged Yuan 16,111/tonne ($2,262/t) in August, Yuan 179/t higher than the prior month's average. On the contrary, China's national price of 99.7% grade primary aluminum ingot softened marginally by Yuan 38/t on month to reach an average of Yuan 20,663/t including the 13% VAT last month, according to Mysteel's assessments.

"Domestic aluminum demand was sluggish through early August during the traditional low-consumption season but began to recover toward month-end, supported by expectations of stronger consumption in September and improving demand from electric vehicle manufacturing and grid investments," a market source observed.

By the end of August, stocks of primary aluminum at trading warehouses in the 16 Chinese cities Mysteel follows amounted to 610,000 tonnes, up by 85,000 tonnes from the previous month.

In addition, NBS data also showed that over January-August, the country's total production of the ten key non-ferrous metals, including aluminum, copper, zinc and lead, gained by 3.1% on year to 54.3 million tonnes. Production of these metals in August registered nearly 7 million tonnes, up 3.8% on year.

Written by Rong Zhang, zhangronga@mysteel.com

Edited by Alyssa Ren, rentingting@mysteel.com