SHFE aluminium price set to ride out Inner Mongolia energy cuts

The price of aluminium in China hit a 10-year high in the week ended Friday February 26, following news on the Thursday that the Inner Mongolia autonomous region would take measures to reduce its energy consumption from 2021 onward under its 14th Five-Year Plan.

The region will not approve any new electrolytic aluminium capacity projects nor any for alumina, according to a draft document titled "Several Safeguard Measures to Ensure The Completion of The 14th Five-Year Plan energy consumption dual control target tasks."
This was released by the Inner Mongolia Autonomous Region Development and Reform Commission on February 25.
In addition to this, sources have heard that several major aluminium producers were asked to reduce their current aluminium operating output, to cut energy consumption.
An estimated 100,000 tonnes per year of aluminium capacity has been shut down since last week, according to one aluminium analyst in Shanghai.

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