SHANGHAI, July 15 (SMM) - Operating rate at aluminium extrusion producers stood at 42.81% in July, up 0.97% month on month and down 18.54% year on year, SMM survey showed. The large-sized enterprises, medium-sized enterprises and small-sized enterprises fell by 22.82%, 7.97% and 0.65% year-on-year. The operating rates of large-sized enterprises declined the most. Operating rates at construction extruders stood at 41%, up 0.89% month on month, but down 19.98% on the year. Operating rates at industrial extrusion companies stood at 48.83%, up1.28% on the month and down 13.86% on the year.

In early-June, Shanghai was unblocked. With the full resumption of work and production, the production, raw material transportation and shipment of construction extruders across the country were resumed. Therefore, the operating rates of enterprises increased. The operating rates of construction extruders increased by 0.89% month-on-month, mainly due to the lifting of the enterprises affected by the pandemic in May and the resumption of production. According to SMM research, many enterprises responded that the overall order volume in June was dragged down by the downturn in the real estate industry. In addition, the order volume is unlikely to increase amid the off-season in July and August. Therefore, although the operating rates increase slightly this month, due to the poor terminal real estate industry, the construction extrusion industry is still weak. In terms of industrial extrusion, the operating rates increased by 1.28% month-on-month due to the relief of the pandemic in June. In addition, the orders of new energy vehicles, photovoltaic power generation, etc. increased amid the domestic favourable policies, hence the orders of industrial extrusion increased significantly.

The finished product inventory/output ratio in June was 40.3%, an increase of 5.5% from the previous month, and the raw material inventory/output ratio was 20.5%, an increase of 0.89 from the previous month. The increase in the inventory/output ratio was mainly because that the enterprises were more willing to purchase amid the falling aluminium prices and the transportation of raw material resumed to normal levels.

Overall, the pandemic eased in June, and the main problem for extruders was the terminal consumption. In July, the real estate industry is affected by the pandemic and the high temperature. Therefore, the orders of construction extrusion in July fall significantly and it is expected that the operating rates will turn to decline in July as a whole.

Industrial extruders are also dragged down by the weak terminal consumption. However, some companies benefit from the continuous growth of the new energy sector, and have more new orders. Therefore, many companies related to new energy vehicles and photovoltaic frame are running at full capacity this month. In July, if the domestic pandemic can be controlled in time, it is expected that the operating rates of the overall industrial extruders will still increase slightly next month.

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