China Aluminium Sector – Growing consumption to drive price rebound
• Demand from the transportation and power industries drove inventories down to a multiyear low, supporting rebound in prices
• Expect narrower surplus in 2024 on keen demand for lightweight materials and supply shortfall amid production suspension in Yunnan
• Limited risk on bauxite supply disruption; stable cost outlook ahead
• The acceleration of the carbon transition trend will further drive demand and support sector earnings CAGR of >20% (2023-2025); our top pick – CHALCO (2600 HK/601600 CH)