Recently, a survey was conducted on the February operating conditions of more than 100 recycled aluminum alloy ingot production enterprises in 12 regions across the country, including Hebei, Shandong, Shanghai, Zhejiang, Chongqing, and Guangdong. From the figure below, it can be seen that the operating rates of aluminum alloy ingot production enterprises in various regions in China in February have significantly increased compared to December. The operating rate in most regions of the country is above 55%, while only Tianjin and Hebei regions continue to be affected by environmental inspections, with operating rates ranging from 26% to 40%; Chongqing, Guangdong, and Liaoning, as important automobile production bases in China, have seen a significant increase in downstream orders after the Spring Festival. Considering that there is little stock available before the holiday, production enterprises should consider increasing inventory in addition to normal order taking during production scheduling after the holiday. Therefore, the operating rates of aluminum alloy ingot production enterprises remain relatively high, at 80%, 79%, and 68%, respectively; The recovery of operating rates in other regions after the 15th Five Year Plan is also very significant, especially with the surge in spot aluminum driving the expectations of related industries for the future market. In the short term, the production and sales situation of aluminum alloy ingot production enterprises is improving. The average operating rate of recycled aluminum alloy ingot enterprises in various regions of China in February was about 66%, an increase of 69.23% compared to the previous month.
Unlike in previous years, there has been no downward trend in the market after the Spring Festival this year. It is worth mentioning that under the premise of a significant increase in domestic and international futures markets and limited supply in the spot market, the market price rose significantly by 3.34% in the second week after the holiday, driving market intermediaries and buyers to actively enter the market. Downstream processing enterprises have slightly slowed down their resumption of work, limited substantive demand boost, and the market's aluminum ingot shipment volume will still show a growth trend. This month, the average price of domestic aluminum alloy ingots according to the national standard ADC12 was 12017 yuan/ton, an increase of 30 yuan/ton compared to January; The average price of non-standard ADC12 aluminum alloy ingots is 10031 yuan/ton, an increase of 31 yuan/ton compared to January. Usually, aluminum alloy ingot prices are priced based on spot aluminum prices. However, due to the low market trading volume before and after the statutory holiday of the Spring Festival, aluminum alloy ingot sales dare not price, so the price fluctuation this month is not significant, but the overall trend is upward.
According to Zhuochuang statistics, the operating rate of qualified recycled aluminum alloy ingot enterprises nationwide is only 26% -80%, and most of them are concentrated at over 60%. As a key area for motor vehicle production, enterprises in the Northeast region often change their pricing to submitting the supply price for the next month at the end of the month. When the market is good, they can better ensure prices by increasing the procurement costs of downstream enterprises; Although there are multiple domestic automobile and motorcycle production enterprises in Chongqing, it has also attracted more than 50 aluminum alloy ingot production enterprises. Last year, motorcycle production decreased by 30%, and nearly half of the aluminum alloy ingot production enterprises suffered losses. The huge competitive pressure has forced local sales prices to be lower than the average price in the same industry. The production capacity of production enterprises returning from the Spring Festival is mainly used to meet customer orders and maintain a small amount of inventory, so the operating rate remains high. On the premise of stable demand, it is expected that there will still be upward space for domestic aluminum alloy ingot prices in March 2016.