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Aluminum Foil Industry Profits Decline, The Industry Needs To Be Self Disciplined
May 10, 2017

Aluminum foil industry profits decline, the industry needs to be self disciplined

By December 29, 2011, China nonferrous metal processing industry association was held in Shanghai in 2011 "double zero foil backbone enterprise senior forum", the meeting hosted by the Shanghai Shanghai Xin Aluminum Co., Ltd., Xiamen xiashun aluminum foil Ya Technology Group Company Limited, Alcoa (Kunshan) Aluminum Co. Ltd., Zhenjiang Dingsheng aluminum industry Limited by Share Ltd nearly 20 domestic double zero foil backbone enterprises to participate in the forum, common aluminum foil industry upgrading, strengthening self-discipline and sustainable development are discussed. Not long ago, the European Union on the part of China coincides with the aluminum foil product specifications anti-dumping, business representatives attending the meeting also had a lively discussion at the meeting to discuss countermeasures. Current status - technology progress speed and new product development progress is far less than the growth rate of production capacity

 

"Five eleven" planning, aluminum processing industry, including aluminum foil has been a hot spot in domestic investment, a large number of capital to enter, to promote the rapid growth of aluminum production capacity. However, due to the market application development efforts are also large, the capacity utilization rate of aluminum processing is still as high as 90%. So far, generally speaking, excess capacity is not too serious. Aluminum foil industry capacity utilization rate is slightly lower than other aluminum.

 

China's aluminum foil industry has become the world's largest producer, consumer and import and export trading country, which is in favor of expanding the production capacity expansion. 2010, aluminum foil production of 15.56% tons, an increase of 40%, accounting for about of the world. In the next few years, the world's share of output may also increase.

2004, China's net imports from aluminum foil into the net exporter of aluminum foil, the annual export volume accounts for about 25~30%, and the continuous growth of the year. With the new project put into operation, the domestic market has been unable to digest the rapid growth of production capacity, the gradual increase in exports.

 

Since the beginning of the twelfth five year plan, the central authorities have repeatedly stressed the transformation of the mode, structure optimization, scientific development, advance steadily, aluminum foil industry have also done a lot of work in terms of technological progress, product upgrading and new product development, but compared with the rapid growth of production capacity, the progress is slow.

 

The problem - capacity utilization has declined to promote the industry within the disorderly competition

Deputy director China nonferrous metal processing industry association and the Secretary General Ma Shiguang said, although in recent years, especially in the first half of 2011 production and sales of aluminum foil, but conceal foil industry capacity utilization rate decreased, the industry average profit decline, companies operating difficulties. Statistics show that in recent years, aluminum foil capacity utilization rate was declining trend year by year. Aluminum foil production capacity utilization rate of 84.7% in 2010, 82.8% in 2011, 2009 1~10 month only 80.4%. It is expected in 2011 year, the national aluminum foil production will reach 2 million 50 thousand tons, with some of the new project completion of the foil material, production capacity may be increased to 2 million 550 thousand tons, capacity utilization will further decline to 80%, will show more serious overcapacity.

 

Excess capacity to the industry development of the direct harm is serious, the first is the product can not sell a good price, corporate efficiency decline, the operating rate is not high, the high cost of financial, scientific and technological input and other factors of sustainable development are weakened. Second is to a greater extent to promote the industry to lower prices for the main performance of the business in the form of disorderly competition. Third is part of the country's exports to China's anti-dumping will become more frequent.

 

"Before the production of 10 tons of money, now to produce 15 tons to earn." A business representative said. He said that the aluminum foil industry is becoming increasingly competitive, especially in some enterprises disorderly competition is the rapid decline in the aluminum foil industry profit margins in recent years.

 

According to Ma Shiguang, China's aluminum foil export commodity prices are very low, the export and import of foreign exchange contrast is obvious, in 2008 ~2010 years, the average annual export volume of aluminum, while imports of tons of aluminum used in the u.s.. Imports of aluminum foil, the average amount of aluminum is 4.3 times the average foreign exchange volume of aluminum.

 

Aluminum foil export profits continue to decline, but also bear the international price volatility. The current domestic and export part of LME aluminum prices upside down, the profit is very low, only a few hundred dollars, and some companies even do not make money, this is the premise for a nation to count 15% tax rebate subsidies under the." A business representative said.

 

"We are not to please." The industry said that the domestic manufacturers of the vicious price competition between hand thinning Chinese enterprises from the international market to earn profits, but also to foreign anti-dumping complaints provide a pretext.

 

"This kind of situation is actually very sad. Now the export tax rebate rate is the highest in history, the state gave the aluminum foil industry export tax rebate is to support the development of the domestic aluminum foil industry, but now we have to put the export tax rebate money to foreign users." Enterprise representatives reluctantly said.

 

China's aluminum processing products frequently suffered anti-dumping, in addition to the United States and other countries of trade protection, China's aluminum industry is also a problem, we need to seriously reflect on it?

Way out - to strengthen the industry self-regulation to broaden the downstream application market

"Investment is still strong, capacity expansion is difficult to effectively inhibit, investment is difficult to recover and the dual pressures of ultra high financial costs, which are extremely easy to encourage the market to price cuts as the main form of disorderly competition behavior. 'Twelfth Five Year' and later a period of time, the aluminum processing industry will show: the rapid growth of production capacity, competition

 

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