【Industry dynamics】High aluminum prices+weakened demand! The operating rate of aluminum processing continues to decline

This week, the operating rate of domestic aluminum downstream processing leading enterprises decreased by 0.4 percentage points compared to last week to 64.2%, an increase of 0.1 percentage points compared to the same period last year.

This week, the operating rates of aluminum plates, foils, profiles, alloys and other sectors have all declined due to sustained weak demand and fluctuations in aluminum prices. Overall, the market is gradually entering the traditional consumption off-season, and there are significant pessimistic expectations for demand in various aluminum processing sectors in the future. It is expected that the comprehensive operating rate of aluminum processing will continue to weaken slowly.

Aluminum strip

This week, the operating rate of leading aluminum plate and strip enterprises decreased by 0.2 percentage points to 76.2%. Downstream demand is still gradually weakening, coupled with the significant fluctuations in aluminum prices within the week, which has triggered a wait-and-see sentiment in the market. Downstream customers have extremely low enthusiasm for placing orders. Some sample companies have once again relaxed their production pace and lowered their operating rates. In the short term, we will focus on the impact of downstream demand marginal variables on the production of aluminum plates and strips. At the same time, with the arrival of high temperature weather in some areas, we need to be vigilant about whether there will be another electricity shortage phenomenon that will interfere with enterprise production.

aluminum foil

This week, the operating rate of leading aluminum foil enterprises decreased by 0.3 percentage points to 77%. This week, aluminum prices have fluctuated significantly, which has disrupted the sentiment of downstream customers in picking up and placing orders. Delays in picking up and placing orders have occurred frequently. In terms of demand, the aluminum foil market is also unable to escape the seasonal decline brought by the end of the peak season, with a more significant decline in orders for products such as food box foil. As the traditional off-season approaches, the operating rate of the aluminum foil industry is expected to continue to slowly decline as demand weakens.

In addition, this week the Shanghai aluminum price reached a high point above 22000 yuan/ton, and downstream sentiment towards high prices was severe, leading to a further reduction in procurement volume. However, due to the widening price difference between ADC12 and A00, there is more room for arbitrage in the market, and the amount of goods received by traders has increased.