Concerns over aluminum supply shortages pushed up share prices of Chinese aluminum producers after the country's Shandong province announced plans to cut production by about 30% to curb pollution, Hong Kong's South China Morning Post reported Aug. 2.
Among the biggest gainers included Aluminum Corp. of China Ltd., or Chalco, which ended Shanghai trading on the same day 7% higher at 6.42 Chinese yuan per share, a record since Aug. 20, 2015. The stock rose by as much as the daily limit of 10% in Shanghai and also gained 4.9% to close at HK$5.14, or about 66 U.S. cents, on the Hong Kong Stock Exchange.
Other producers, including Yunnan Aluminum Co. and Shandong Nanshan Aluminum, also rose 4.6% and 4.2% in Shenzhen and Shanghai trading, respectively.
According to the report, smelters in the province plan to cut production by up to 30% starting from November, in a move that could reduce aluminum output by 860,000 tonnes. Plants that fail to meet emission standards will be forced to cease production.
As of Aug. 2, US$1 was equivalent to 6.72 Chinese yuan.