China is set to overtake Australia and become the world`s top alumina producer in 2006 - forcing prices lower, analyst Wang Feihong told delegates at the China Aluminium Forum conference.
Mr Wang, chief analyst at Beijing Antaike Information Development Co, said that output of alumina will rise by 45% to 20 Mt/y in 2007, and that prices may average US$255/t - less than half the average price seen this year, reported Bloomberg.
"Both China and the rest of the world are ramping up their alumina output," said Mr Wang, adding that global supply of aluminum will exceed demand by 250,000 to 300,000 t next year.
Also speaking at the conference was Wen Xianjun, director of the China Nonferrous Metals Industry Association, who said he expects China`s consumption of primary aluminium to increase 18% this year, reaching 8.38 Mt, compared with 7.1 Mt in 2005, said Reuters.
Growth of aluminium capacity in China is expected to slow to 11.1% this year, against 14.4% last year, said Mr Wen, thanks mainly to Beijing`s efforts in slowing investment in the resource intensive aluminium industry.
The conference brought together government, analysts and companies, including Aluminum Corp of China (Chinalco) - the only producer of alumina and the largest producer of primary aluminum in China.
Vice president Ao Hong told delegates that Chinalco plans to buy copper smelters in China and invest in overseas mines to help diversify production and boost sales, said a report by Bloomberg, adding that by 2010, Chinalco should have reached copper cathode production capacity of 900,000 t/y.
China is the biggest user and producer of aluminium, and the demand will rise by 25% next year to 10.7 Mt if the government keeps a tax-rebate policy unchanged on the export of aluminum products, Mr Wang added.
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