It is reported that China government unveiled an industrial boost plan to revitalize home nonferrous metals sector during 2009 to 2011.

 

The plan stressed that nonferrous industry adjustment should be combined volume control with layout optimization, independent innovation with technological upgrading and assets consolidation with institutional development. China will not only reasonably develop and utilize domestic resources, but also will encourage enterprises to have outward investment.

 

In line with the plan, China will try hard to get production of nonferrous metals back to normal in 2009 and close down 300,000 tonnes of copper backward melting capacity, 600,000 tonnes of lead and 400,000 tonnes of zinc. 800,000 tonnes of small prebaking smelters of electrolytic aluminum will be eliminated by the end of 2010.

 

China will set up 3 to 5 powerful conglomerates in 2010, and will have top 10 firms to control 90% of copper production 70% of aluminum, 60% of lead and 60% of zinc by 2011. In the same year, supply ratio of copper, aluminum and nickel will reach 40%, 56% and 38% respectively, while production of secondary copper and aluminum is taking up 35% and 25% of the total copper and aluminum yield, up 6% and 4% from that in 2008.

 

Besides strictly controlling import of high energy-consuming and high polluted" resource products, China will carry out flexible export duties to shore up export of hi-tech and high value added products. In the following three years, China will not allow, in principle, to found, rebuild or enlarge electrolytic aluminum plant, and will curb new production capacity in copper, lead, zinc, titanium and magnesium sectors.

 

The plan will push copper, aluminum, lead and zinc enterprises to regroup in many ways, such as inter-regional mergers, intra-regional reorganizations and consolidations between groups. Moreover, the government will also bolster aluminum smelters to merge with coal and power enterprises, and buoy up secondary metal companies to join together.

 

The boosting plan will focus on capacity control of nonferrous metals in disadvantaged regions, joint operation of aluminum-electricity in the central west and construction of aluminum industrial bases in advantaged areas.

 

Furthermore, China will also accelerate prospection on scarce nonferrous metals and increase state stockpiling. Large sized nonferrous groups will be backed to invest in mining both at home and abroad as well. Meanwhile, China will speed up to build nonferrous metal recycling system and retrievement and disassembling markets in future.

 

(Source: Shanghai Securities)