1.1 Primary Aluminum Production Outside China According to statistics from the International Aluminium Institute (IAI), the cumulative global primary aluminum output (excluding China) from January to November 2025 reached 27.05 million tonnes, representing a slight year-on-year increase of 0.6%. The overall supply capacity showed no significant changes compared with the end of the previous year. The average daily output in November 2025 stood at 81,000 tonnes, up 0.5% from the beginning of the year.
Source: IAI
Figure 1-1 Average Daily Primary Aluminum Output in Overseas Markets
Since 2025, there have been frequent reports of commissioning and production cuts at overseas aluminum smelters. In terms of newly commissioned or under-construction projects: - In Q1 2025, the Phase II project of Huaqing Aluminum Industry was fully put into operation, achieving its full-year designed capacity of 500,000 tonnes. - In April, Xinfeng Group launched two joint-venture primary aluminum projects with capacities of 600,000 tonnes/year and 550,000 tonnes/year respectively in the Indonesia Weda Bay Industrial Park and the Morowali Tsingshan Industrial Park in Sulawesi Island. - In July, the Arctial Project, jointly initiated by Rio Tinto Group, ABB and Finnish local enterprises, was officially launched. Located in the Kokkola Industrial Zone of Finland, the project adopts Rio Tinto's advanced AP60 electrolysis technology, with a planned capacity of approximately 550,000 tonnes/year. Scheduled for completion and commissioning in 2029, it will be the first new primary aluminum smelter built in Europe in more than 30 years. - In August, the 250,000-tonne/year primary aluminum project of Indonesia Juwan Aluminum Industry successfully completed power transmission in the core area of the Indonesia Weda Bay Industrial Park (IWIP). The project features 400kA electrolytic cells and is designed to produce 250,000 tonnes of primary aluminum annually. - The Indonesia PT Kalimantan Aluminium Industry (KAI) primary aluminum project, a joint venture between ADMR and China Lithium & Energy Group, was commissioned in phases in 2025. Situated in the Kalimantan Industrial Park Indonesia (KIPI) in North Kalimantan, Indonesia, the project has a total planned capacity of 1.5 million tonnes/year, constructed in three phases, with the first phase of 500,000 tonnes/year having been successfully put into operation. In addition, the primary aluminum project of Huatong Cable in Angola is expected to be commissioned in early 2026, with a total capacity of 120,000 tonnes/year in Phase I. On the production cut side: In October, several overseas aluminum smelters faced production reduction risks due to sudden electrical failures and power supply issues. - Noroural Grundartangi ehf, a wholly-owned subsidiary of Century Aluminum, was forced to cut approximately two-thirds of its production capacity due to electrical equipment malfunctions; the smelter has a designed capacity of around 200,000 tonnes/year. - South32 announced plans to shut down its aluminum smelter in Mozambique, which has a capacity of about 600,000 tonnes/year, as high electricity costs made operations unsustainable. On December 16, the company confirmed that the plant would undergo maintenance and halt production around March 15, 2026. - Furthermore, Rio Tinto Group revealed that it is considering closing its Tomago aluminum smelter in Australia upon the expiration of its power contract in 2028, citing the failure to secure a stable and cost-effective power supplier. The smelter has a production capacity of 600,000 tonnes/year. According to statistics from Antaike, by the end of 2025, the global total primary aluminum production capacity reached 78.89 million tonnes/year, of which overseas capacity accounted for 34.73 million tonnes/year, a year-on-year increase of 0.5%. The global primary aluminum output in 2025 was approximately 74.23 million tonnes, up 1.7% year-on-year; among this, overseas primary aluminum output stood at 30 million tonnes, a year-on-year rise of 1.7%, accounting for 40.4% of the global total output.
Source: Antaike
Figure 1-2 Overseas Primary Aluminum Output, 2016-2025F
1.2 Primary Aluminum Production in China China's primary aluminum production capacity maintained a steady growth trend in 2025. On one hand, since the beginning of the year, the rapid decline in alumina prices has led to a significant drop in primary aluminum production costs. Coupled with rising aluminum prices, corporate operating conditions have improved markedly. Production capacities that were idled due to losses at the end of 2024 in Sichuan, Guizhou and other regions resumed production successively in Q1 2025. On the other hand, new capacity releases from projects such as Chalco Qinghai and Yunnan Aluminum Yixin have further expanded the operating capacity scale of the industry. According to Antaike statistics, in 2025, the resumed primary aluminum production capacity reached 550,000 tonnes/year, with 180,000 tonnes/year of newly commissioned capacity (excluding new construction under capacity replacement for operating projects). In addition, some primary aluminum enterprises in Guangxi and other regions shut down electrolytic cells for energy-saving retrofits at the start of the year and resumed production in August, resulting in a relatively minor impact from production cuts. By the end of December 2025, China's installed primary aluminum production capacity reached 44.83 million tonnes/year, an increase of 270,000 tonnes/year compared with the previous year; the operating capacity stood at 44.25 million tonnes/year, a rise of 690,000 tonnes/year from the beginning of the year.
Table 1-1 Changes in China's Primary Aluminum Production Capacity, 2025 (10,000 tonnes/year)
Source: Antaike
From the perspective of changes in operating capacity over time: In the first half of the year, benefiting from the production resumption of Sichuan's primary aluminum enterprises and the continuous release of new capacity at Chalco Qinghai, operating capacity grew rapidly, driving an increase in supply capacity. At the end of the year, the commissioning of the technological transformation project of Xinjiang Tianshan Aluminum Industry after power transmission brought another round of capacity expansion. There were 4 newly commissioned projects in 2025: 1. The 500,000-tonne/year capacity replacement and upgrading project of Chalco Qinghai Branch was commissioned at the end of December 2024 and gradually ramped up production in 2025. 2. In June 2025, the Phase III project of Heqing Yixin Aluminum Industry was officially put into operation, pushing the total production capacity of Heqing Yixin Aluminum Industry to a new level of 450,000 tonnes/year and releasing 35,000 tonnes/year of idle capacity. 3. In July 2025, the first batch of production lines of the 1.93-million-tonne low-carbon aluminum project of Yunnan Honghe New Materials Co., Ltd. was commissioned, with an initial production capacity of 378,000 tonnes/year. 4. In November 2025, the first batch of electrolytic cells of the 1.4-million-tonne green and low-carbon energy efficiency improvement project of Tianshan Aluminum Industry was officially energized and started up, releasing 200,000 tonnes/year of idle capacity quotas. In addition, on December 20, the first batch of electrolytic cells of the 350,000-tonne green power aluminum project in Zhahanaor successfully completed power transmission, releasing a production capacity of 350,000 tonnes/year. However, its output contribution will be gradually realized in 2026. The 550,000 tonnes/year of resumed production capacity in 2025 was mainly distributed in Sichuan, Guizhou, Guangxi and other provinces/regions. Most of the resumed capacity came from enterprises that suspended operations at the end of 2024 due to severe operating pressure, with a portion coming from projects launched after technological transformation.
Table 1-2 Changes in Resumed Primary Aluminum Production Capacity in China, 2025 (10,000 tonnes/year)
Source: Antaike
Since 2013, China's primary aluminum production capacity has accounted for more than 50% of the global total. The proportion continued to expand until 2017, reaching a historical high of 58.3% that year. After 2017, under the adjustment of supply-side structural reforms, the momentum of capacity expansion in China's primary aluminum industry slowed significantly, and its global share has generally shown a downward trend. In the future, with the large-scale commissioning of overseas new projects, China's capacity share will further shrink. According to Antaike statistics, by the end of 2025, China's installed primary aluminum production capacity reached 44.83 million tonnes/year, accounting for 56.3% of the global total capacity of 79.56 million tonnes/year, a decrease of 0.2 percentage points compared with the previous year. Capacity replacement progressed at an accelerated pace in 2025, further optimizing the layout of primary aluminum production capacity. Meanwhile, with the implementation of technological transformation projects, the proportion of 600kA electrolytic cells is rising rapidly. Capacity replacement mainly falls into three categories: 1. Continuous transfer of production capacity from Shandong to Yunnan. 2. Accelerated relocation of enterprises from Henan and other regions to Xinjiang and Inner Mongolia. 3. Enterprises including Qinghai Qiaotou, Qinghai Baihe, Qingtongxia Aluminum Industry and Huomei Hongjun have all launched capacity replacement and transformation/upgrading projects for 600kA electrolytic cells. In recent years, securing low electricity prices and access to new energy have become the top priorities for enterprises in capacity relocation, with regions represented by Xinjiang emerging as key destinations. In 2025, Yidian Group and Wanji Group successively announced capacity replacement plans to relocate production to Inner Mongolia and Xinjiang respectively, marking the largest-scale cross-regional relocation in recent years and attracting significant industry attention. At the same time, the continuous transfer of primary aluminum production capacity from Shandong to Yunnan has led to a clear trend of capacity decline in Shandong and growth in Yunnan. In 2025, the top five provinces/regions in China in terms of primary aluminum production capacity were Inner Mongolia, Yunnan, Xinjiang, Shandong and Gansu, with respective shares of 14.9%, 14.5%, 14.4%, 14.1% and 6.8%. Compared with 2023, these shares changed by +0.2, +1.5, +0.2, -1.9 and -0.1 percentage points respectively. In terms of output, due to the time lag in statistical caliber during the capacity transfer process, output exceeded installed capacity in individual provinces/regions.
Source: Antaike
Figure 1-3 Distribution of China's Primary Aluminum Production Capacity, 2023 vs 2025
1.3 Operational Performance of China's Primary Aluminum Industry In 2025, falling prices of raw materials and energy such as alumina and electricity drove down primary aluminum production costs. Meanwhile, buoyed by multiple factors including overseas supply disruptions, growing demand expectations and the US Federal Reserve's interest rate cuts, aluminum prices continued to rise, enabling the entire industry to maintain a high level of profitability. Particularly in the fourth quarter, as the price level rose significantly, the profit per tonne of aluminum surged to over RMB 5,000. According to Antaike's calculations, the weighted average total cost (including tax) of primary aluminum in China in 2025 was RMB 16,722 per tonne, a year-on-year decrease of 5.6% or RMB 995 per tonne. The average annual profit per tonne of aluminum reached approximately RMB 4,028 (excluding VAT and corporate income tax due to varying tax rates across regions), setting a record high and representing a year-on-year increase of 80.8% or RMB 1,801.
Source: Antaike
Figure 1-4 Cost and Theoretical Profit-and-Loss Trend of China's Primary Aluminum Industry, 2025
In terms of seasonal performance, profit levels in the first half of the year were less robust than in the second half. In the first half, alumina prices remained relatively high and aluminum prices rose steadily, with some enterprises even facing operational pressure in January. In the second half, as prices of alumina, electricity and other inputs continued to decline, primary aluminum production costs decreased while aluminum prices stayed at a high level, driving a continuous improvement in industry profitability. The entire industry achieved profitability, with particularly outstanding performance in the fourth quarter.
Source: Antaike
Figure 1-5 Capacity Cost Curve of China's Primary Aluminum Industry, 2025