Singapore 09/03/2016 - Global primary aluminium market balance is expected to turn into a deficit of 1.2 million tonnes in 2016, compared to 600,000 tonnes of surplus in 2015, Russian aluminium producer Rusal said Wednesday.
Global aluminium demand will continue to grow by a healthy 5.7 percent or three million tonnes to 59.6 million tonnes in 2016, due to strong demand growth in North America, Europe, it said.
This compares to a 5.6 percent increase in world aluminium demand to 56.4 million tonnes in 2015.
Chinese aluminium demand is expected to grow a strong seven percent to 31 million tonnes in 2016.
The transportation sector will remain the biggest growth contribution in 2016 with half of 1.5 million tonnes growth followed by construction and electrical/consumer durables and packaging sectors, it said.
On the supply side, Rusal forecasts Chinese aluminium production to grow at the slowest pace over the last five years by 4.8 percent in 2016 compared to a five-year average growth of 12 percent and 9.6 percent in 2015.
Around one million tonnes of ex-China production was cut in 2015 and another 0.5 million tonnes will be cut in the first half of 2016, according to Rusal.
Chinese net semis exports grew by 17.5 percent to 3.7 million tonnes in 2015, and are expected to slowdown in 2016 on higher Shanghai Future Exchange price owing to local capacity curtailments and tight domestic metal supply, it said.