Delta Aluminium Postpones Second-Phase Expansion, China

Delta Aluminium Industry, Guangdong based Chinese major secondary aluminium alloy maker in which Daiki Aluminium Industry has 20% interest, decided to postpone the second-phase capacity expansion originally scheduled in this autumn. The expansion will be implemented in 2010. Daiki explained that Delta Aluminium should improve the existent plant’s productivity before the expansion and that Chinese secondary aluminium alloy market is concerned to slow down in a short term.

Delta Aluminium had planned to start the second-phase capacity expansion within September 2009. The firm aimed to increase the capacity to 100,000 tonnes per year, double from the present.

Delta Aluminium commenced production in January 2009 and kept high operation at average 3,000 tonnes per month. A half of secondary aluminium alloy is exported mainly for Japan. Meanwhile, the existent capacity is 4,000 tonnes per month and the productivity can still be improved.

Chinese demand for secondary aluminium alloy is expected to grow steadily in a long term. However, in a short term, domestic automobile sales may slow down in 2010 after Chinese governmental policy ends to offer subsidy for people purchasing new cars.

Daiki Aluminium explained the firm will restart a talking with Delta Aluminium about the second-phase expansion after productivity improvement at Delta Aluminium’s existent plant as well as cautious market observation.