Chinese aluminium producer Henan Shenhuo Coal & Power Co Ltd said this week that it plans to ramp up to its full production capacity of 900 thousand metric tons by the end of this month due to a consistent power supply to its plant in Yunnan province.
Per local news sources, the power grid in Yunnan has slowly restored the full power supply to aluminium smelters in the area due to elevated rain totals so far this spring.
Yunnan province has been a popular location for locating aluminium smelting capacity in recent years thanks to its abundant hydroelectric power. Several Chinese firms have relocated large chunks of aluminium smelting capacity recently from northern provinces like Shandong, which relies primarily upon coal to produce power.
Shenhuo planned to move over half of its 1.7 million metric tons per annum of aluminium production capacity to Yunnan last year, but a power cut in the province delayed the transfer. Last year the firm had a utilization rate of only 41.67 percent of its total aluminium production capacity as a result according to a recent filing to the Shenzhen Stock Exchange.
The filing went on to say that Shenhuo has restarted the shuttered capacity there as well as adding an additional 150 thousand metric tons per annum of aluminium smelting capacity that was already built but not yet brought online.
Per the filing, Shenhuo showed a profit of CN¥1.95 billion (US$298.49 million) last quarter, three times above the prior quarter’s total.