BEIJING : Power supplies to aluminium smelters in China's southwestern Yunnan province will be increased later this month, an official familiar with the situation told Reuters on Tuesday, allowing some capacity in the drought-hit region to restart operations.Yunnan, China's fourth biggest producing region
BEIJING : Power supplies to aluminium smelters in China's southwestern Yunnan province will be increased later this month, an official familiar with the situation told Reuters on Tuesday, allowing some capacity in the drought-hit region to restart operations.
Yunnan, China's fourth biggest producing region for electrolytic aluminium, has required smelters to reduce production twice since last September, lowering operating rates by about 40 per cent in total at some companies, after unusually low levels of rainfall impacted hydropower generation. Hydropower accounts for about 70 per cent of total power supply in the province, which has about 5.25 million metric tons of aluminium-making capacity.
"Now the conditions allow, we will gradually resume [power supply]," said the person, declining to give his name because he is not authorized to speak to media.The resumption would take place in late June, he added, though exact amount of power supply to resume and the date are still being decided and will be based on weather and market demand.
They will be allowed to resume 20 per cent of halted capacity, while further resumption will depend on future power supply, he added.Yunnan's power curbs have cut 1.65 million metric tons of aluminium capacity, according to Su Yanbo, researcher of electrolytic aluminium at Beijing Aladdiny Zhongying Business Consulting."But as concerns over power supply in the second half of the year linger, there will be producers slowing down or even delaying production resumption," Su said.
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