China will step up efforts to reduce overcapacity and energy consumption in its nonferrous metals industry and is aiming to keep its annual output of 10 major metals at 46 million tonnes by 2015, from 31.21 million tonnes in 2010, an industry website reported on Tuesday.
Based on the latest five-year development plan between 2011 and 2015 for the industry, China has forecast its total copper production to grow on average 7.3 percent per year to reach 6.5 million tonnes by 2015, compared with an actual output of 5.18 million tonnes in 2011, according to government plans posted on a website owned by the China Non-ferrous Metals Industry Association. (http://www.cnmn.com.cn reported.)
The website also said China aims to keep its aluminium output limited at around 24 million tonnes by 2015. The website did not give details on its source of information but similar production guidelines issued by the Chinese government in the past have often been aspirational and enforcement on production curbs in various industries, such as steel and aluminium smelting, have been lax.
For example, even though Beijing has ordered local governments to shut 800,000 tonnes of outdated aluminium smelting capacity between 2011-2015 as part of efforts to reduce excess capacity, it has not been able to deter these companies from replacing outdated units with modern facilities that have far bigger capacity. Beijing has also laid out plans to close 300,000 tonnes of refined copper smelting capacity, 1.2 million tonnes of lead smelting capacity and 400,000 tonnes of zinc smelting capacity from 2011 to 2015.
Further evidence of Beijing's limited success in trying to control the sector is actual output's consistent surpassing of targets set by the government under previous five-year development plans. "Chinese companies are very profit driven; if there is any money to be made, even if it was slim margins, then businesses would expand. So these sorts of top down orders rarely ever work."
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