BEIJING – China's Chalco said on Friday it boosted annual aluminium output by 16% in 2018, putting it ahead of Russia's Rusal as the world's second-biggest publicly traded producer of the metal.
The increase underscores China's growing dominance of the global aluminium market, as the world's biggest producer and consumer of the metal, although weak aluminium prices have already led to some production being shuttered this year.
State-controlled Chalco, formally known as Aluminum Corp of China, said in a presentation to analysts reviewed by Reuters that its aluminium production came in at 4.17-million tonnes last year, beating the 3.753-million tonnes churned out by Rusal.
The Russian company, formerly the world's top producer, had already been overtaken in terms of output by China Hongqiao Group in 2015.
Chalco did not immediately reply to a request for comment.
Chalco's unlisted parent, Chinalco, now has a group capacity in excess of five-million tonnes after taking over Yunnan Aluminium last year.
US sanctions on Rusal, announced last April but withdrawn in January, did not have any major impact on the Russian company's production, but its aluminium sales did fall 7.2% in 2018.
Rusal will keep its aluminium production stable at 3.8-million tonnes in 2019, its stakeholder En+ said.
Beijing-based Chalco last produced more metal than Rusal in 2012, when both firms produced more than 4 million tonnes of aluminium, according to a review of company filings.
Chalco, which in late 2017 started a 500 000 t/y aluminium smelter in Inner Mongolia, managed to raise annual output considerably despite being forced to close some production toward the end of the year as Shanghai aluminium prices tanked.
It has already shuttered 200 000 t of capacity in 2019, while Rusal plans to launch the second line of its Boguchansk aluminium smelter in Siberia by the end of this month.
"Chalco is still saddled with higher costs of production compared to the private behemoths like Hongqiao and Xinfa... which means it is more exposed to soft metal prices," said Paul Adkins, MD of aluminium consultancy AZ China.
"If metal prices don't improve soon, they may not stay at that level of output for long," Adkins said.
Chalco posted its first quarterly loss in more than three years on Thursday and said annual net profits fell last year due to low aluminium prices and slack domestic demand.
Chalco also said its alumina production rose by 5.5% in 2018 to 13.51-million tonnes, as it sought to capitalise on global shortages of the aluminium raw material.