According to the statistics of Antaike, in 2015, electrolytic aluminum enterprises implementing flexible production spread across 17 provinces, municipalities and districts, mainly concentrated in Gansu, Qinghai and Henan. The annual total volume of shutdowns was 4.27 million tons/year, of which 44% of the production capacity was reduced in the fourth quarter. Data show that from 2015 to March 2016, the total shutdown capacity of China's electrolytic aluminum is about 4.5 million tons/year, which is comparable to the financial crisis period in 2008. Large-scale elastic production has an obvious effect on output, and the growth rate of China's electrolytic aluminum supply dropped sharply at the beginning of 2016.

In February 2016, China's output of electrolytic aluminum reached 2.434 million tons, up 2.6% year on year, hitting the lowest growth rate in the same period of nearly a decade. Affected by a sharp decline in supply growth, domestic aluminum ingot inventory growth is expected to slow down significantly in early 2016. According to statistics, in February 2016, the main areas of domestic aluminum ingot inventory is about 900,000 tons, basically flat with the same period last year; However, due to the expansion of the consumption base, the consumption days corresponding to the inventory of aluminum ingots decreased, indicating that the market surplus pressure eased.

Data show that in February 2016, China's apparent consumption of primary aluminum was 2.378 million tons, up 2.6% year on year, down 3.7 percentage points from the same period last year, in line with market expectations. It is expected that China's electrolytic aluminum production capacity will increase by about 3 million tons/year in 2016, among which the production scale will be about 1.5 million tons/year, and most of them will be concentrated in the second half of 2016.

At present, the domestic production capacity that can be restarted after shutdown is about 3.5 million tons/year, and the newly built capacity that has not been put into production is about 1 million tons/year. Considering the enterprise capital, market and other factors, it is expected that 50% of the production capacity will be started in the second half of 2016, making limited contribution to the annual production.

China's primary aluminum consumption is mainly concentrated in five fields. In the field of construction and structure, the area of completed housing has dropped sharply. It is expected that the growth of domestic aluminum for doors, Windows and curtain walls is limited, but the export performance is still good. In the field of electronic power, due to the recovery of investment in power grid and the growth of output of 3C products, the overall situation is stable. In terms of transportation, in 2015, the growth rate of automobile production returned to a reasonable range, but the rigid demand remained stable, and the replacement potential of lightweight was huge. Therefore, it played a positive role in promoting aluminum consumption. In terms of packaging containers, aluminum foil packaging and tin material containers are non-cyclical industries, which are less affected by economic fluctuations and have strong rigid demand. The growth rate of primary aluminum consumption is relatively stable. In terms of consumer durables, with the recovery of the real estate market and the acceleration of housing destocking, the consumption of durable goods such as home appliances will improve, promoting the growth of primary aluminum consumption. The export of aluminum has formed a stable terminal customer base, the exchange rate, tariff policy and other factors to support the export growth, has a driving effect on the consumption of primary aluminum.

China is expected to consume 32.8 million tons of primary aluminum in 2016, up 7.2 percent. At the beginning of 2016, the domestic spot price of alumina was 1,630 yuan/ton, and it has risen to 1,915 yuan/ton by the middle of March, with a rise rate of 17.5%. The cost of alumina will rise further in the future.

Currently running China's electrolytic aluminium production capacity of nearly 80% using self-provided power, as the "fund" industrial structure adjustment, electricity change the self-provided power plant of form a complete set of documents for a uniform standby fee and various funds self-provided power plant of standards, and implementation of the ultra low emission environmental transformation, the future of China's aluminium energy costs are expected to rise.

Affected by capital, market and other factors, it is expected that China's new and restarted electrolytic aluminum production capacity will be limited in 2016, which is difficult to impact the annual supply. Although economic growth is slowing down and growth momentum of aluminum consumption is weakening, the growth of aluminum consumption in China can still be expected in the context of stable demand in various fields and increasingly fierce competition for material substitution. Cost leading factors "power", "alumina" prices have periodically hit bottom, in the tight balance between supply and demand pattern, the future cost factor price rise will form a bottom support for aluminum prices. It is expected that in the second quarter of this year, domestic and foreign aluminum prices will appear in the year's high probability, aluminum prices in the third quarter to maintain high shocks, prices in the fourth quarter or will gradually adjust. The annual LME average price of aluminum in March was USD1580 / ton, down 6.1% from the previous year. The average price of SHFE aluminum in March is 12000 yuan/ton, down 2.4% compared with the previous year. The decline in aluminum prices significantly narrowed, business pressure is expected to improve, the industry ushered in a stage of recovery.