GJ Bush - Professional rubber bushing supplier & car suspension bushes manufacturer

Industry News

Home  > News  > Industry News  > 

What is the reason for the soaring aluminum price so "crazy"?

What is the reason for the soaring aluminum price so "crazy"?

2021-10-15

Recently, the price of aluminum has been rising like a runaway horse, constantly refreshing market perceptions. The "crazy" of aluminum prices broke through the psychological expectations of die-casting companies, causing many die-casting companies that use aluminum alloy as raw materials to complain. But why do aluminum prices continue to rise?

1. The imbalance between supply and demand

The latest data from the World Metal Statistics Bureau show that the global aluminum market will have a supply shortage of 655,000 tons from January to May 2021. In May 2021, the global aluminum market consumption was 6.0565 million tons. Global aluminum production in May 2021 was 5.7987 million tons, an increase of 5.5% year-on-year. As of the end of May 2021, the global aluminum market inventory was -233,000 tons.

On the contrary, according to data from the Passenger Association, the retail sales of new energy vehicles and passenger vehicles in China reached 249,000 in August this year, a year-on-year increase of 167.5% and a month-on-month increase of 12.0%. From January to August, the retail sales of new energy vehicles were 1.479 million, a year-on-year increase of 202.1%. Sales of new energy vehicles have exploded.

According to experiments by international research institutes, replacing traditional steel with aluminum to make cars can reduce the weight of the entire vehicle by 30% to 40%; using aluminum to make engines can reduce weight by 30%; aluminum radiators are 20% lighter than the same copper products; the aluminum car body is more than 40% lighter than the original steel products. Therefore, using aluminum instead of steel to make cars has a significant weight reduction effect.

In the face of the explosive growth of new energy vehicle sales and the increasing demand for aluminum structural parts under the trend of lightweighting, the global aluminum market, which was originally affected by the epidemic, is even worse. In the next period of time, the price of aluminum will continue to rise higher than expected.


1. Electricity and production restrictions, rising freight rates, and increasing aluminum shortages

Since the beginning of 2021, the nationwide power supply shortage has severely affected the domestic electrolytic aluminum supply, and the reduction in production due to power curtailment has been 1.234 million tons. In the near future, the impact of regional power curtailment is still deepening, and the scale of electrolytic aluminum production reduction may expand. At the same time, the consumer side showed strong resilience, and off-season inventories continued to deplete to a lower level, so aluminum prices continued to rise.

Affected by the global epidemic in August, global bauxite shipping costs increased. On September 5, the coup in Guinea triggered worries about the supply of bauxite, which undoubtedly aggravated the rise in aluminum prices. With the increase in the price of imported ore, the domestic ore market has become more active than before. The export of Guinea bauxite is very important to China and the world. This event has provided new upward momentum for the high aluminum price since 2006 and the hot alumina market.

Domestically, due to the continuous rise in aluminum prices and limited growth in raw material scrap aluminum, expectations are low. Worries about the shortage of scrap aluminum supply will intensify in the near future.


2. The price of silicon has skyrocketed, and the price of recycled aluminum has reached a new high

The soaring silicon price has triggered a chain reaction downstream of the industrial chain. The effect is transmitted all the way to secondary aluminum, aluminum alloy and other fields. The soaring price of silicon has driven the cost of secondary aluminum alloys to increase significantly. Although the downstream demand is not strong and the transaction is average, the price of secondary aluminum is still rising due to the cost.

The supply of silicon materials was exhausted in a relatively short period of time, and the market continued to change in the direction of short supply. Therefore, the price of silicon materials continued to rise. Sufficient downstream orders will stimulate silicon wafer companies to continue to increase their purchasing demand to ensure their high operating rates. Therefore, in the short term, the state of the polysilicon market will gradually transition from tight supply and demand to short supply, which will further support the continued rise in silicon material prices.

Based on the above internal and external factors, the cost of the entire aluminum processing industry from raw materials, transportation, cost and other links is rising, and there is a large gap in the aluminum market supply field. At present, the rise in aluminum prices is expected to continue to rise.


We GJ bush factory is mainly focus on rubber bush, engine mounting, shock mounting, sometimes aluminum material will be used for our products. We are glad to share you the latest news in the market.


Chat Online
Chat Online
Chat Online inputting...
Sign in with: