Aluminum sheet, strip and foil is an aluminum processing product that is lightweight, anti-corrosive and has good thermal conductivity. It is widely used in packaging, construction, transportation, electronic appliances and other fields.
Supply side: The output of most aluminum sheet, strip and foil products is expected to be lower than expected in 2022 and early 2023. The main reasons include insufficient orders, fierce competition in the industry, and production reduction to reduce losses. According to SMM statistics, China's aluminum plate and strip (including aluminum foil billet) production is expected to be approximately 12.3 million tons in 2023, a decrease of approximately 600,000 tons from last year. Total aluminum foil production is expected to be approximately 4.5 million tons, a decrease of approximately 250,000 tons from last year.
Demand side: Affected by the global economic downturn, China's aluminum plate, strip and foil production may experience negative growth in 2023. The proportion of relatively low value-added industrial machinery and architectural decoration aluminum plate and foil products is expected to continue to decline. On the other hand, driven by plastic restriction orders and lightweight policies, the proportion of aluminum sheet, strip and foil products used for packaging and transportation will increase. Although profit margins may decrease in 2023, output is still expected to grow against the trend. Especially representative products such as automotive sheets and battery aluminum foil.
New production capacity: New production capacity is expected to lead to intensified competition within the industry. Currently, there are 26 aluminum plate, strip and foil projects under construction across the country, with a total designed production capacity of 3.942 million tons. Almost all of these projects are planned to be completed before 2025, of which 2024 will be the peak of production. It is expected that approximately 2.53 million tons of new production capacity will be put into production in 2024, accounting for 64.2% of the production capacity under construction. It is particularly worth noting that battery aluminum foil has become the main product of new aluminum plate, strip and foil projects. Among them, 14 projects under construction are highly related to battery aluminum foil, with a total designed production capacity of 1.322 million tons.
