Today, China accounts for more than half of the global aluminum supply, while in 2003 only 18% of this growth thanks to cheap electricity and most efficient way to build a global aluminum smelter. Lowest prices and margins and profits in the face of the financial crisis since both fell from the old aluminum manufacturer in North America, Russia and the Middle East are very anxious, but because of fear of losing market share, they are not going to cut capacity.
China announced in June after record production, aluminum (11970, -60.00, -0.50%) fell last week to the lowest point for six years. In the first half of this year, China’s aluminum production increased by more than 11%, resulting in China’s aluminum exports increased by 35%.
The largest US aluminum producer Alcoa Inc. (Alcoa) estimated that due to China’s exports, the global aluminum surplus will reach 760,000 tons – enough to make 16,000 Boeing 747 (Boeing 747) aircraft. Because aluminum prices fell by 14%, Alcoa’s stock price has fallen 37 percent this year.
Some Chinese aluminum business directly processed into liquid hot metal coil, can be obtained at the time of export VAT refund, but in third countries can easily remelting of aluminum.