China’s Aluminum Exports Decline by 7.6% in Q1 Amid Domestic and Global Shifts

China exported 1,365,000 metric tons of primary aluminum and aluminum products in the first quarter of 2025, marking a 7.6% decline compared to the same period last year, according to Shanghai Metals Market (SMM). March exports totaled 506,000 metric tons, reflecting broader trends in China’s aluminum trade amid domestic production shifts and global market pressures.

The drop in exports comes as China approaches its government-imposed annual production cap of 45 million metric tons, a ceiling introduced to combat overcapacity and reduce emissions. This cap has limited growth in aluminum output, which is expected to rise only marginally by 2% this year. Additionally, the removal of tax rebates on aluminum exports in December 2024 has further impacted outbound shipments. These rebates previously incentivized foreign sales but were eliminated to prioritize domestic consumption and self-sufficiency.

Chinese smelters have managed to increase average capacity utilization to 91.7% in March, despite historically low treatment charges for imported concentrates and challenging market conditions. Higher sulfuric acid prices helped offset losses in refining operations, while many smelters shifted toward using more copper scrap and blister copper to maintain production levels.

China continues to commission new aluminum plants, with several new lines starting operations in southeastern and eastern provinces during Q1. SMM expects average daily aluminum production to rise further in April as these facilities ramp up output. However, analysts warn that geopolitical tensions, including U.S. tariffs on Chinese aluminum imports, could exacerbate challenges for exporters.