Chalco Pegs Aluminum Consumption Growth at 7-9%

SEATTLE (Scrap Monster): An official at the Aluminum Corporation of China (Chalco) has predicted 7-9% growth in aluminum consumption in the country during 2018 and 2019. Speaking at the CRU Aluminum Conference in London, Jiang Yinggang, Senior Vice President, Chalco said that Chinese aluminum consumption is likely to reach 43 million tonnes in 2020, as compared with 35.4 million tonnes in 2017. Incidentally, China is the world’s largest aluminum consumer.

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Yinggang also stated that the country’s biggest state-run aluminum producer has no contact with Rusal, the Russian producer who was recently hit by U.S. sanctions. He clarified that the company, at the present moment, has no plan whatsoever to deal with Rusal. Incidentally, Chalco and Rusal are considered to be the two largest aluminum producers across the world. The production by Chalco had totaled around 3.61 million tonnes as against Rusal’s production of 3.71 million tonnes.

Chalco had recently reported huge fall in net profits during the first quarter of 2018, mainly on account of drop in aluminum prices. The company’s Q1 profits have declined by over 19%, from 382.9 million yuan a year before to 308.6 million yuan during January to March 2018. At the same time, revenues have fallen by nearly 11% to total 36.7 billion yuan.

Aluminum prices had rallied to their highest in several years, after Washington announced sanctions on Rusal. The prices cooled off Monday when the US decided to grant more time to comply with the ban. Further, it noted that the US would even consider lifting the sanctions against Rusal if Oleg Deripaska, who owns 48% of Rusal shares, gives up control of the company. The Treasury has now extended the deadline to Americans to wind down business with Rusal until October 23, 2018.