Chinese aluminum smelters plan to idle roughly one-third of their capacity - the most since 2009 - as energy costs rise and aluminum prices slump, Bloomberg reported.
The country is expected to produce nearly 20 million metric tons of aluminum and reach a production capacity of 30 million tons by the end of the year, said Luo Rongjin, an analyst with Bocom International Holdings.
Alcoa Inc (AA.NYSE), Rio Tinto (RIO.NYSE; LON; ASX) and other global rivals have cut production as monthly output from China has fallen after prices dropped 19% last year. Aluminum prices have been dragged down by macroeconomic data and political actions, especially the sovereign debt crisis in the eurozone, said Daniel Briesemann, an analyst at Commerzbank AG in Frankfurt. Alcoa said earlier this month it would idle 12% of its global capacity, while Rio Tinto said in November that it would shut its Lynemouth smelter in England.
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