* Aluminium fluoride producer also halves production
* Cite downturn hitting demand
* Aluminium trading only just above production cost
DUBAI, March 29 – Two Chinese aluminium producers, Shengxin Aluminum and Shanghai Unison Aluminium, have cut their output by half due to the economic downturn, executives said on Sunday.
Sinochem Shanghai Corp, which makes aluminium fluoride, used for smelting aluminium, is also slashing its production by 50 percent.
“The economic crisis affected all aluminium manufacturers in China because there is less demand and prices fell by more than 55 percent. We all had to cut down on production,” said Horus Huang, a marketing representative for Shengxin.
“We are here today fighting for customers,” Huang said at an Aluminium conference in Dubai.
China is the world’s largest producer and consumer of aluminium, which is used mainly in transport and packaging. Demand has plummeted as economies around the world have plunged into recession.
The metal is trading only slightly higher than its estimated average cost of production of $1,300 per tonne, but there is still too much capacity and analysts say more production cuts are necessary to bring the market back into balance.
Shengxin has cut production by 50 percent to 15,000 tonnes per year, Huang said.
Unison has also halved output, to 10,000 tonnes, sales engineer David Tian said.
“Since the economic crisis our customer base is still the same, but our orders are down by 50 percent,” Tian said.
Sinochem Shanghai’s previous output of 60,000 tonnes per year of aluminium fluoride has been reduced to 30,000, sales manager Ray Li said, adding the state-owned company’s profits have fallen by more than 50 percent.
But smelter Dubai Aluminium Co. (Dubal) also said on Sunday it plans to keep its output steady at 950,000 tonnes per year, despite falling demand for commodities.