This increase is due to strong demand and low aluminium inventories. China, the world's largest aluminium producer, produced 3.58 million tonnes of primary aluminium last month.
Production in September increased notably in the Yunnan province, the fourth-largest aluminium-producing region in China. This increase was because smelters increased their operations, and the hydropower supply improved.
A year ago, production in the same region had to be reduced due to low rainfall and water levels, resulting in a 2 million tonne capacity reduction through the year's first half.
Despite the higher production, aluminium stocks remained low, primarily due to strong domestic demand from the solar and power sectors. Aluminium stocks on the Shanghai Futures Exchange hit their lowest point since March 2019 in September, down 66 per cent from the previous year. This low supply and high demand increased aluminium prices, with the most-traded aluminium contract on the Shanghai Futures Exchange reaching a 15-month peak in late September.
Higher prices boosted the average profit by 805 RMB per tonne, or nearly 28 per cent, compared to the previous month.
