Aluminum Corp of China Ltd (Chalco) struggled in the opening half of 2020, as profits fell by 95 percent and its aluminium production fell behind its Russian rival Rusal during the year’s first six months.
For the first half of 2020, Chalco smelted 1.86 million metric tons of primary aluminium, off by 30 thousand metric tons smelted in 2019’s opening half. That total is 10 thousand metric tons short of Rusal’s aluminium production total for the year through June, dropping Chalco to the world’s fourth-biggest aluminium producer by volume. Rusal now regains the podium as third-biggest producer, behind China Hongqiao Group and Chalco’s parent company Chinalco.
Chalco reported net income in the period of CNY35.17 million, of from last year’s first-half income of CNY707.41 million. The half-year’s total is dismal indeed, as the calculated third-quarter net income of CNY5 million is the weakest quarter since 2018’s closing quarter, which was a net loss.
First-half revenue dropped to CNY84.11 billion, down by 11.5 percent on the year. Chalco chalked it up to a 4.3-percent fall in aluminium prices at the Shanghai exchange. Lower prices also prompted the firm to shutter a trio of alumina production lines last month.
Despite lower aluminium production in the first half, Chalco reported a 5.74-percent rise in alumina refining during the period, totaling 7.2 million metric tons.
Chalco says it expects better numbers for the current half, as domestic demand for aluminium has come roaring back. It notes that aluminium prices rose to a multi-year high last week of nearly CNY15,000 per metric ton, coming back strongly from a crash in both demand and prices occasioned by the ongoing coronavirus pandemic.