Cutbacks on power supplies in the People’s Republic of China so far this year have translated in a cut of 7 percent of the country’s overall aluminium capacity. Such was the conclusion of a Wood Mackenzie report released yesterday.
According to the report, the cuts are a result of Beijing’s restructuring of its power infrastructure heading into winter. Copper production, which is less energy intensive, has fared better, according to the report.
“We identified around 3.2 million tonnes per annum (of aluminium) capacity was cut so far this year, of which only a little has been restarted … We also expect more (aluminium production) suspensions in Yunnan (province) in the fourth quarter as the impact of insufficient hydropower supply has been exacerbated by the dry season.”
China’s power cuts relented last month, but power shortages did not relent in the month. Experts estimate that power rationing could continue into next summer.
Thus far power restrictions have led to the reduction of 60 thousand metric tons per annum of copper capacity, 850 thousand metric tons per annum of stainless steel melt, and 350 thousand tons of nickel pig iron. Nickel consumption has fallen by 110 thousand metric tons so far this year as well.
Meanwhile, power cuts in southern provinces has dropped lead production by between 50 thousand and 60 thousand metric tons per annum so far.