Aluminum, silicon production may be impacted by power rationing in Sichuan
Due to the decreased rainfall and higher demand for electricity, China is likely to again implement power rationing, which may affect aluminum and silicon production.
The recent hot weather boosted power consumption by 1.3% year on year, making the already low-water-level hydropower stations in Sichuan province severer.
Aluminum smelters near Chengdu have been asked to reduce electricity consumption, which may lead to a drop of around 50,000 tons in annual aluminum output. Besides, silicon producers in Ebian were also required to reduce production from July 3 to 21 due to high temperatures.
The market is worried that the production suspension in Sichuan will impact the production capacity of some companies or industries, such as Tesla and solar component manufacturers, whose capacity was hit last year.
