Under the optimism of commodities, non-ferrous metals as a whole will usher in a rebound. If there is one variety that will be the first to pull up, it may be aluminum. Yunnan's production reduction, aluminum ingot destocking, and automobile consumption remain strong, which can be said to be the best time and place.
For the variety of aluminum, the gap is obvious, which is an important reason why the price of aluminum can rise.
In 2024, it is expected that the domestic electrolytic aluminum production capacity will be slightly short, with a supply-demand gap of about -800,000 tons, which is expected to support a slight upward trend in aluminum prices, while overseas supply and demand will be loose, with a supply-demand gap of about 400,000 tons, and aluminum prices are expected to continue to maintain a pattern of "strong inside and weak outside". In terms of quarters, it is expected that in the first half of the year, the demand for real estate completion is still growing, the peak season in the second quarter is the most scarce time for the whole year, the increase brought about by the resumption of production capacity in Yunnan in the third quarter will promote the return of supply and demand to balance, and in the fourth quarter, driven by the peak season of automobile production and photovoltaic installation, aluminum ingots are expected to appear again in the destocking market.
Supply side: production disruptions
According to SMM statistics, the domestic electrolytic aluminum output in November 2023 (30 days) will be about 3.488 million tons, a year-on-year increase of 4.6%. In November, the production of electrolytic aluminum in Yunnan was stopped, and the average daily output of domestic electrolytic aluminum fell by 1,185 tons month-on-month to 116,300 tons/day. From January to November, the cumulative output of domestic electrolytic aluminum was 37.946 million tons, an increase of 3.6%.
As of December 28, 5,000 tons to 409,000 tons of aluminum ingots and 4,000 to 80,000 tons of aluminum rods were destocked.
According to customs data, the total domestic primary aluminum imports in November 2023 reached 194,000 tons, a decrease of 10.3% month-on-month and a year-on-year increase of 75.6%, and the cumulative domestic primary aluminum imports from January to November were 1.367 million tons, a year-on-year increase of 153%. In November 2023, China imported a total of 11.9276 million tons of bauxite, an increase of 7.19% month-on-month and 1.17% year-on-year. In terms of countries, 8.008 million tons were imported from Guinea, an increase of 13.05% month-on-month and 10.03% year-on-year, and 3.501 million tons were imported from Australia, an increase of 2.3% month-on-month and 23.45% year-on-year. In November 2023, alumina imports were 129,000 tons, an increase of 30.30% month-on-month and a year-on-year decrease of 34.22%. From January to November 2023, the cumulative import was 1.5586 million tons, a year-on-year decrease of 17.83%, and the net import of alumina in November was -4,200 tons, and the cumulative net import from January to November 2023 was 424,900 tons.
The retail sales of narrow passenger cars in December are expected to be 2.27 million units, and the new energy vehicles are expected to be 940,000 units. The consumption of aluminum rod and wire exceeded expectations.
Guinea oil depot explosion, some mines production reduction, China imported 8 million tons of Guinean bauxite in November, Guinea mine production reduction will have a non-negligible impact on China's domestic bauxite supply. The domestic alumina plant in Shanxi is limited by the lack of domestic ore supply, the overall output is expected to decline, and the follow-up supply of domestic alumina is expected to be tight. In terms of electrolytic aluminum, the domestic market continued to go to the warehouse during the week, and the aluminum price remained high. In terms of consumption, the consumption of passenger cars remained strong, and the consumption of aluminum rods and wires increased more than expected. In the short term, it is expected to maintain a strong trend of shocks, and the reference operating range of the main domestic contract: 18,500 yuan - 19,500 yuan. Overseas reference operating range: $2,150-$2,350.