China Hongqiao to shift 1.93 million tonnes of aluminium smelting capacity to Yunnan province

As per the local government notice, it has been revealed that the world's largest aluminium producer, China Hongqiao Group, which engulfs the entire aluminium industry chain, plans to shift 1.93 million tonnes of aluminium capacity to the Honghe prefecture in southwest Yunnan province.

The statement released by the Yunnan industry department, which says that, the Chinese state-owned company that specializes in the production of aluminium lines up to reposition capacity from six projects in its Shandong units to Yunnan Honghe New Material Co via a capacity swap plan.

The largest aluminium manufacturer, Hongqiao had committed to displacing around 2 million tonnes of its annual capacity from eastern Shandong province to Yunnan's Wenshan prefecture for smooth access to hydropower, a pristine source of energy than dry fossil fuel. However, in May 2021 it was reported that the company was contemplating relocating more production capacity to Honghe prefecture.

It was proposed that more than 60% of the company's 6.46 million tonnes of authorised annual primary aluminium capacity will be relocated to Yunnan.

In the Southern part of China, Yunnan is homeland to approx. 10% of the nation’s aluminium capacity. The province is very much dependent on hydropower for 75% of its electricity, although energy output from hydro plants had been plummeting during October and November both on a monthly and annual basis.

Zhang Bo, the Chairman of Hongqiao Group said in October that however, the proposal of relocation was rescheduled in regards to power restraints imposed by the provincial government earlier in 2021, though the company had been in dialogue with authorities to make it possible.