For the global copper and aluminum market, "China factor" seems to have become synonymous with price. Is it because China’s consumer demand is too strong and has driven global prices, or is the “China factor†the subject of speculation by international speculators? How big is the Chinese consumer pull factor China's consumption and demand are considered to be the more important factors in the supply and demand relationship between copper and aluminum. In the global aluminum market chain, the Chinese market is a market with large potential, and the Chinese factor is already a more active factor. The process of urbanization and industrialization in China has been accelerating, and investments in basic industries such as electricity, transportation, and construction have increased. In particular, the rapid development of the automobile manufacturing and packaging industries has directly stimulated aluminum consumption. Domestic and foreign industry insiders have different views on this. Xia Weiping, president of Aluminum Corporation of China, stated that China has indeed become the world's largest primary aluminum consumer market and has been a global market highlight for the past five years. From 2001 to 2004, two of them accounted for more than half of the world. China Aluminum Industry is an indispensable part of the world aluminum industry. In 2005, China’s aluminum processing capacity and output both leapt to the top in the world. Statistical data indicate that about two-thirds of the world’s primary aluminum output increase since 2001 has come from China, and China has become the world’s leading producer of aluminum production. power. However, Xiong Weiping believes that the impact of the world's primary aluminum, the Chinese factor is an objective reality, but it should not be exaggerated, it is not appropriate to speculate; consumption is increasing, but the amount is not great. In per capita consumption, it has not reached the world average. Some international organizations have also questioned whether China's consumption can be satisfied through production. The answer from China Aluminium, a large domestic manufacturer, was that before 2002, China needed to import part of it from abroad, but then China's primary aluminum changed from an importer to an exporter, satisfying their own needs. What needs to be imported at present is special aluminum alloys and processed materials. Aluminum oxide is missing. Last year, 48% of the demand was imported. This year it is estimated that there are more than 7 million tons of imports. Our country's dependence on alumina imports has reached 42%. At present, Chinalco's alumina production reaches about 12 million tons. It is gratifying to see companies other than Chinalco start to appear. They also have more than 3 million tons of production. From a global perspective, primary aluminum demand and consumption are basically balanced. China's alumina still needs to rely on imports in the next 5-10 years, but the degree of dependence will continue to decrease. Global Pricing and Chinese Characteristics At present, some alumina producers outside China have taken into consideration the market demand of China and Russia when expanding their markets. Therefore, how much is the relevance of the pricing mechanism of the global market to the Chinese factor? Industry experts said that for the global aluminum pricing, part of the long-term contracts to determine the price of alumina, which is linked to the LME three months of futures factors 13-15%, but the ratio of close to more than 20%. That is to say, the alumina price of the contract will not follow the market, and this amount accounts for 70% of the total amount. In addition, the spot transaction is determined based on supply and demand. The current alumina price at the port is around 6,000 yuan/ton. Spot price changes will be improved based on changes in supply and demand, but as China's alumina production rises, prices are expected to return to a reasonable area. Some traders stated that there are many new investors entering the market in China and other markets. So that within a few days, a few hours may have hundreds of dollars up and down changes. Therefore, investors will question whether there are hedge funds making waves. Industry experts believe that, in general, there are two major factors that affect aluminum prices: First, there is a shortage, and second, costs increase, and the cost impact is mainly the consumption of electricity and energy. Participating experts believe that aluminum supply and demand this year may not be as tight as the market estimates. From the perspective of aluminum production, due to rising oil prices, the price of electricity will be correspondingly increased. Having said that, in fact, China has not seen this effect. At present, the price of aluminum is soaring. All domestic aluminum producers can make money and profitability is relatively good. It is very important that China's aluminum production capacity can not be discounted, and their cost structure is not affected by the international oil prices. China's electricity is relatively cheap. At present, 20% are hydropower, 80% are thermoelectric, and most of them are coal-fired power plants, so the cost is not affected by global oil prices. Overall, global supply and demand for aluminum is relatively balanced. Experts at the meeting believe that there may be regional imbalances. Domestic and foreign market interaction In the past 3-6 months, the daily turnover of aluminum on the Shanghai Futures Exchange has changed from 50,000 contracts to 200,000 contracts, and the market has undergone tremendous changes. Some experts have learned and tracked the volume increase of Shanghai Aluminum, and found that many transactions originally used Shanghai contracts to hedge LMEs. Now it is done in reverse. There is interaction between the two markets, but there is no obvious aluminum in the copper trade. Experts in the industry believe that the current LME copper price and aluminum price have greatly changed and the trading volume has naturally increased. Aluminum producers hope to be more active in aluminum trading in the future, which is beneficial to the hedging of companies. Copper consumption in the United States has increased by 9% in recent years, which is an alarming increase. International observers also believe that it is difficult to accurately define the consumption and demand of copper. Therefore, there are speculations about the numbers. Some overseas experts also stated that China’s copper consumption has become a very controversial topic. There is a view that China's demand has driven the price of copper, but the accuracy of digital collection and the statistics of the stocks in various places are difficult. Therefore, many of the understandings are not theoretical differences, but there are differences in statistics. Industry insiders suggested that it is necessary for the Shanghai market to introduce copper options. At the same time, all the London Gold Exchanges may establish a delivery warehouse in Shanghai, which is also a way to reduce the spread, and achieve the docking of the two markets. However, bonded warehouses do not necessarily reduce the spread. Only by opening up the domestic market and gradually integrating with London can we achieve domestic and international price synchronization. The key issue at present is that domestic investors and international investors are inconsistent in their price judgments, and sometimes they are not synchronized. Shanghai Futures Exchange stated that QFII will be introduced in due course, which will also help the integration of the two markets. Landscape Lighting,Led Garden Lights,Garden Wall Lights 10W,6W Led Underground Lamp Arilux Worldwide International Co. Limited , https://www.ariluxworldwide.com