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Global economic growth has promoted the steady increase of aluminum demand in various terminal industries. Aluminum is widely used in construction, transportation, machinery manufacturing, power electronics and other pillar industries of the national economy. Therefore, economic growth will drive the steady increase of aluminum demand. According to IAI data, from 2009 to 2019, global aluminum consumption increased steadily from 35.38 million tons to 64.14 million tons, with an annual compound growth rate of 6.1%, about twice the global economic growth

China's electrolytic aluminum production capacity has entered the stage of "controlling the total amount and optimizing the stock". The large-scale capacity removal action has basically ended. The future policy will focus on structural adjustment. It is expected that the national electrolytic aluminum production capacity will reach 45 million tons by the end of 2022. The output of electrolytic aluminum abroad has entered a long-term growth stagnation period. According to IAI data, China's electrolytic aluminum output accounts for half of the world, and the global electrolytic aluminum increment has basically come from China since 2000. Especially in the past five years, China's electrolytic aluminum increment accounts for more than 90% of the global increment, and the year-on-year growth rate of foreign electrolytic aluminum output is less than 1%, which has entered a long-term growth stagnation period

From 2012 to 2020, China's recycled aluminum production entered a low-speed growth stage, with an annual compound growth rate of only 5.3%, lower than the growth rate of primary aluminum, and the proportion of recycled aluminum continued to remain low. In the short term, the continuous release of primary aluminum production capacity will suppress the growth of recycled aluminum, and the output base of recycled aluminum is low, and the increment has little impact on aluminum supply

Compared with copper and aluminum industry, the aluminum price center is expected to move upward

The market scale of copper and aluminum exceeds trillion yuan, which are the two largest varieties of non-ferrous metals. Looking back on history, we find that the copper price center has been moving upward. On the one hand, the smelting cost center has been moving upward due to the gradual decline of copper resource reserves and grade; On the other hand, the financial attribute of copper is strengthened under the global loose currency. Compared with copper, the upward movement of aluminum price center is not obvious, because bauxite resources are rich, raw material end restrictions are small, and aluminum financial attributes are weak. In the long run, under the background of "carbon neutralization", the high energy consuming aluminum industry will face the cost drive at the energy end, and the superimposed capacity ceiling will push the aluminum price center upward

China's electrolytic aluminum industry chain fully enjoys the benefits of rising aluminum prices

The core pricing model of the copper industry chain is "copper futures price - processing fee", that is, the price of copper concentrate = copper futures price - processing fee. Therefore, the biggest beneficiary of copper price rise is copper mines, and the upper limit of income of copper smelters is processing fee (TC / RC). Global copper resources are in short supply, and China's copper self-sufficiency rate is low, with an external dependence of more than 75%.

All links of the aluminum industry are priced by upstream and downstream supply and demand, and Chinese enterprises have completed the layout of the whole industrial chain, from bauxite in Guinea to alumina and electrolytic aluminum production capacity accounting for more than half of the world and global aluminum processing base. The world is rich in bauxite resources, and Chinese aluminum enterprises led by Weiqiao and Chinalco have more aluminum resource reserves and less resource constraints. In the future, aluminum smelting will fully benefit from the rise of electrolytic aluminum prices, and Chinese aluminum enterprises are expected to be the biggest beneficiaries