On March 22, Aluminum Corporation Of China Limited(601600) released the performance report for 2021, which showed that Aluminum Corporation Of China Limited(601600) achieved an operating revenue of 269748 billion yuan in 2021, a year-on-year increase of 45.03%; The net profit attributable to the shareholders of the listed company was 5.08 billion yuan, a year-on-year increase of 564.6%; The net profit attributable to shareholders of listed companies after deducting non recurring profits and losses was 7.03 billion yuan, a year-on-year increase of 158693%; The net operating cash flow was 28.306 billion yuan, an increase of 89.28% year-on-year, the best level in history.
In 2021, due to the continuous rise of China’s aluminum price, the performance of many aluminum enterprises increased significantly. Industry insiders believe that at present, aluminum prices will remain high.
aluminum price hit a new high
It is understood that in the second half of 2021, due to the gradual change of alumina market price from gentle operation to sharp rise, the shortage of domestic ore supply could not be effectively alleviated, resulting in the overall rise of bauxite price in China. Compared with the same period in 2020, China’s bauxite price is at a relatively high level. In 2021, the price focus of China’s alumina moved upward compared with last year. The highest price of China’s alumina was 4101 yuan / ton, the lowest price was 2331 yuan / ton, and the annual average price was 2798 yuan / ton, an increase of 19.7% compared with 2020. In the international market, in 2021, the average price of LME spot aluminum was about US $2480 / ton, an increase of 45.5% over 2020; The average price of LME three-month aluminum is about US $2485 / ton, up 43.3% from 2020.
In addition, the price focus of electrolytic aluminum in China shifted significantly higher than expected in 2021. The price of electrolytic aluminum in Shanghai Metal Exchange rose rapidly from mid and late January to a high of nearly 15 years in October. Affected by the strong supervision of coal prices, the price of electrolytic aluminum fell sharply in mid and late October, fell to a five-month low, rebounded to the bottom in early December, and the decline narrowed. In 2021, the average price of SHFE aluminum in the current month and March was 18953 yuan / ton and 18898 yuan / ton respectively, up 34.2% and 37.3% respectively compared with 2020.
Regarding the reasons for the substantial increase in performance, Aluminum Corporation Of China Limited(601600) told the Securities Daily that in 2021 Aluminum Corporation Of China Limited(601600) focused on comprehensively improving the ability of value creation, adopted “five steps” to promote all factor benchmarking, and continuously improved the return on net assets, market share, labor productivity and cost competitiveness, forming a replicable and popularized electrolytic aluminum “five standards and one control” management mode, shaping the industry management brand. At the same time, we will strengthen market-oriented operation, actively stabilize prices and ensure supply, and introduce the “double horse racing” mechanism to significantly reduce logistics and procurement costs.
In terms of various businesses, in 2021, the operating revenue of Aluminum Corporation Of China Limited(601600) alumina sector was 56.546 billion yuan, an increase of 14.168 billion yuan compared with 42.378 billion yuan in the same period of last year; The pre tax profit was 4.049 billion yuan, an increase of 2.614 billion yuan compared with 1.435 billion yuan in the same period last year. This is mainly due to the increase in output brought by the company’s mining project in Guinea and the supporting Guangxi Huasheng alumina project, as well as the impact of the year-on-year rise in alumina prices.
the operating revenue of Aluminum Corporation Of China Limited(601600) primary aluminum sector was 72.644 billion yuan, an increase of 20.755 billion yuan compared with 51.889 billion yuan in the same period of last year, and the profit before tax was 7.402 billion yuan, an increase of 5.379 billion yuan compared with 2.023 billion yuan in the same period of last year. Mainly due to the year-on-year rise in the price of primary aluminum and the year-on-year increase in the gross profit of the company’s products.
performance of aluminum enterprises generally increased
The reporter of Securities Daily found that among the seven listed aluminum companies that have disclosed the annual report of 2021, the net profit attributable to the shareholders of listed companies has achieved double-digit growth or above, of which Aluminum Corporation Of China Limited(601600) ranked first with an increase of 564.6% and Yunnan Aluminium Co.Ltd(000807) ranked second with an increase of 267.7%.
As for the reasons for the rise of aluminum price in 2021, a chief analyst of the metal industry of a securities firm said that the rise of aluminum price in 2021 was due to the supply side and demand side. From the supply side, the state has always strictly controlled the production capacity of aluminum. Electrolytic aluminum itself belongs to an industry with high energy consumption. In recent years, the state has hardly approved the production expansion index of enterprises, which basically belongs to stock replacement. In recent years, only Yunnan has a relatively large increase in electrolytic aluminum production capacity. Since the second half of last year, the power supply has been relatively tight, and the power restriction has affected the capacity utilization of electrolytic aluminum in Yunnan; In addition, a series of reforms have not set an upper limit on the supply of aluminum, which has led to an increase in the cost of energy consumption for enterprises. From the demand side, electrolytic aluminum is a lightweight metal. In the process of China’s gradual consumption upgrading, the consumption of aluminum products has increased well, so the gap between supply and demand does exist objectively.
For the next trend of aluminum price, the aforementioned analysts believe that it is unlikely that the aluminum price will rise sharply this year, but it is expected that the aluminum price will run at a high level this year and gradually go up. “The rising cost will be a long-term trend, because the fluctuation of electricity price is very obvious to the increase of electrolytic aluminum cost. From the supply side, the long-term direction of China’s energy structure transformation will not change, and it is difficult for local governments to liberalize the electrolytic aluminum index on a large scale. In the long run, it is expected that the aluminum price will still rise steadily.” The source believes that the impact of geopolitical factors and Australia’s ban on the export of alumina to Russia on the global aluminum price will not be as exaggerated as “Russian nickel”, because in essence, the global share of Russian nickel supply and overseas exports will be much larger than aluminum.
“In the next three to five years, as long as the general direction of the national policy on energy transformation remains unchanged, affected by factors such as increased energy costs and limited production capacity, and there are no major problems in the downstream consumption of aluminum, the aluminum price will continue to strengthen for a long time, and the relevant aluminum enterprises can maintain a good performance.” The above analysts said.
