Inner Mongolia approves relocation of primary aluminum capacity from Henan

A plan to relocate 240,000 tonnes/year of primary aluminum capacity from Central China's Henan province to North China's Inner Mongolia autonomous region was announced on January 5 on the official website of Inner Mongolia's Department of Industry and Information Technology, indicating that the relocation plan has received regulatory approval.

The relocation will be carried out through an internal capacity transfer by Yidian Holding Group Co., Ltd., a Chinese aluminum and power producer. Under the plan, the company will transfer 240,000 t/y of primary aluminum capacity from its controlling subsidiary Henan Hengkang Aluminum Co., Ltd. (Hengkang Aluminum) located in Sanmenxia city, Henan, to another controlling subsidiary, Inner Mongolia Dongshan Aluminum Co., Ltd. (Dongshan Aluminum), based in Chifeng city, Inner Mongolia, according to the announcement.

The two subsidiaries, Hengkang Aluminum and Dongshan Aluminum, have signed a capacity transfer agreement and formulated a capacity swap plan, the announcement said. The swap plan had been opened for public consultation on December 11 for 10 working days and has now been formally publicized.

Under the central government's "capacity swap" guidelines for industrial capacity, whenever new capacity is erected – in this case, aluminum smelting capacity – old facilities of at least the same productive capacity in operation at the time must be stopped and eventually scrapped. The scheme has served as an effective tool for Beijing to cool the once surging expansion of the country's aluminum capacity, as reported.

As part of the project, Dongshan Aluminum plans to build and commission 150 new 600-kA electrolytic cells, with a combined capacity of 240,000 t/y, at the High-Tech Industrial Development Zone in Chifeng by August 2026. Correspondingly, Hengkang Aluminum will fully shut down its existing 220 400-kA electrolytic cells of 240,000 t/y before the new capacity is commissioned, to comply with the swap guidelines. Hengkang has already submitted a capacity exit report to the relevant local authorities in Henan, Mysteel Global understands.

Inner Mongolia is rich in renewable energy resources such as wind and solar power, which can provide low-cost green electricity for the energy-intensive primary aluminum production, prompting some Chinese smelters to relocate capacity to the region. In 2024, primary aluminum output in Inner Mongolia totalled 6.7 million tonnes, accounting for 15.2% of China's national output, according to public information.

Yidian Holding Group, headquartered in Luoyang city, Henan, is engaged in aluminum smelting, aluminum processing, and power generation. The group currently holds 840,000 t/y of primary aluminum capacity, 600,000 t/y of aluminum plate, strip and foil capacity, and 2.22 million kilowatts of installed thermal power capacity.

Written by Iris Pang, pangjunyu@mysteel.com

Edited by Russ McCulloch, russ.mcculloch@mysteel.com

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