Chinese Primary Aluminum Output Hits Record 4.2Mt in May

China's National Bureau of Statistics reported May primary aluminum production of 4.2 million tonnes, the highest monthly figure on record. The 4.3% year-on-year increase reflects the full restoration of Yunnan province smelting capacity after the end of the dry season. Yunnan's hydropower-dependent smelters, which account for roughly 12% of China's total capacity, were operating at 95% utilization in May, up from 50% during the winter 2025 rationing period.

The production surge extends China's dominance. The country now produces 61% of global primary aluminum, up from 58% in 2023, as new capacity in Inner Mongolia and Guangxi continues to ramp up. Annualized Chinese production is running at roughly 50 million tonnes per year, in line with the 50.5 million tonne cap set by the National Development and Reform Commission.

Chinese semi-fabricated aluminum product exports reached 520,000 tonnes in May, the highest monthly level since 2022. The export surge is pressuring global semifinished markets, particularly extrusion and flat-rolled products in Europe and Southeast Asia. The EU is considering extending anti-dumping measures on Chinese aluminum extrusions, currently set to expire in October 2026.

The domestic Chinese market shows mixed demand signals. Property sector aluminum use continues to contract, down 3.2% year-on-year. Solar photovoltaic frame demand remains strong at 18% growth. Automotive aluminum use grew 5.7%, driven by NEV production, which now uses 25% more aluminum per vehicle than ICE equivalents.

The aluminum supply surplus is estimated at 500,000-800,000t globally for Q3 2026, according to CRU Group, the largest since 2023. This surplus is concentrated in China, which exported 2.3 million tonnes of unwrought aluminum and semi-fab products in the first five months of 2026.