Major aluminum producers plan joint venture for commercial storage

A worker at a production line of Nannan Aluminum Co Ltd in Nanning, capital of Guangxi Zhuang autonomous region. [Photo/China Daily]

Six Chinese major aluminum producers are likely to form a joint venture for possible commercial storage of aluminum amid huge overcapacity and shrinking demand, a source quoted by China Securities Journal said.

Though the details have not been disclosed, the move by the aluminum majors - Aluminum Corporation of China (Chinalco), China Power Investment Corp, Shandong Weiqiao Aluminum and Electricity Corp and Jiuquan Iron and Steel Group - sends a positive signal to the already-limping sector, experts said.

Earlier report by Reuters said that the government planned to purchase and store about a million tons of aluminum last year in a bid to help support the domestic market.

The commercial storage is a different concept from purchase and storage from the government. It means that each company will put a certain amount of their products together to realize a centralized reserve, experts said.