China to Ease Up on Aluminium Production
September 6, 2021
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China’s Guangxi region is the third largest producer of alumina [produced from aluminium] with an output of 925,500 tonnes in July alone. On August 31st 2021, the price of aluminium rose to its highest level in more than 10 years. This is due to Chinese smelters facing tough power controls on production of the metal. China’s production of aluminium will still rise, but at a lower rate than normal.
Eight smelting companies in Guangxi will need to keep their production in September at a maximum of 80% of average monthly output in the first half of the year. This could result in a reduction of 475,000 tonnes in annual operating capacity. China relies on coal-fired electricity for its aluminium production. The use of coal-fired electricity in the electric grid decreased from 77% in 2010, to 62% in 2019. This is in stark contrast to the figures for aluminium electrolysis, which remained at approx 90%.
- In 2020, China’s production of primary aluminium rose by 5% year after year to a historic high, most for domestic consumption.
- Chinese production of primary aluminium is almost totally reliant on coal-fired electricity. This resulted in 667 Mt CO2 emissions in 2020, greater than Indonesia’s total emissions.
- The inefficient ‘subcritical’ coal capacity used for production of aluminium in China amounts to 47 GW, more than Germany’s total coal fleet.
- China is under immense pressure to close production plants, in line with the International Energy Agency’s [IEA] demands for the closure of all subcritical coal plants by 2030.
Production of primary aluminium in China saw a dip in early 2020 due to the outbreak of the coronavirus. Following industrial stimulus designed to boost economic growth, production regained its momentum and was up by 5% later that year.
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