Global Aluminium Production Down by 1.5% in Q1

Global Aluminium Production Down by 1.5% in Q1
Aluminium, SAG Lend, Salzburg (state), Austria. Source: Wikimedia

According to numbers recently released by the International Aluminium Institute (IAI), worldwide aluminium production for the first four months of 2016 fell by 1.5% year-on-year, totaling a global production of 18.1 million metric tons.

In its report, the IAI indicates that the reason for the global decline is largely due to production cuts continued by the People’s Republic of China, following up on their pledge made in December to cut capacity. China’s output for the quarter fell 7.6% to 9.74 million metric tons. This drop continues a downward trend reported on last month by the IAI, which described an output drop of 461,000 metric tons year-on-year in the months between December and February, inclusive.

In December, smelters in China agreed to eliminate half a million metric tons by the end of the month, and not to add to production in the coming year as well. The cuts represent about twelve percent of the Middle Kingdom’s yearly output of aluminium, but cuts were offset slightly by two million metric tons of new activity for the year. China Hongqiao independently announced a cut in production of 250,000 metric tons in December as well, representing about six percent of the smelter’s total output. Hongqiao walked back the cuts later in March, however, when it announced that it would expand capacity to six million metric tons per annum, or sixteen percent, by the end of 2016, depending on market conditions.

Also making an impact was a concurrent drop in production in North America. Output fell 7.9% in the quarter, dropping tonnage to 1.37 million metric tons.

In contrast, ex-China production was up year-on-year by 14.5% to 1.1 million tons in the quarter.

Overall average daily output grew slightly, up by 0.6% in the first quarter, bumping the number up to 157,400 metric tons per day.