SHANGHAI, Sep 8 - (SMM) Boosted by the European energy crisis that restrains aluminium supply, the share prices of aluminium companies in the Chinese stock market jumped yesterday. Electricity prices in Europe soared, leading to further cuts in the aluminium smelting industry, which consumes enormous amount of power.
France's Dunkirk Aluminium, Europe's largest aluminium smelter, on Tuesday announced a 22% cut in output, the latest in a wave of output cuts sparked by soaring electricity prices. According to statistics, the electricity cost of producing 1 mt of aluminium in Germany last week was about $4,200. LME aluminium stood at just $2,300/mt. This means that local aluminium production is deeply loss-making. Aluminium is one of the most energy-intensive metals to produce, with approximately 14,000 kWh of electricity required to produce 1 mt of aluminium. As Europe's energy crisis continues to intensify, European electricity prices have soared to record highs, and many aluminium smelters have cut or stopped production due to rising costs in response to soaring energy costs.
Domestic aluminium prices have risen nearly 10% since mid-July, which improved the profitability of domestic smelters.
