Aluminium firm eyes expansion as prices fall
Asia Aluminum Holdings is to capitalise on an expected price fall by expanding its business.
Managing director Benby Chan Yiu-tsuan said after a shareholders' meeting yesterday that he expected a recent surge in the price of aluminium ingots in China to an end before too long.
'The Chinese aluminium ingot market situation has recently been pretty erratic in the sense the price has gone up quite significantly,' Mr Chan said.
The price surge was mainly due to the limited supply of aluminium ingots in the country. Prices had increased about 20 per cent this year.
'But if you look at the market as a whole and also [take] into consideration the expanded capacity of Chinese smelters, there will be an oversupply situation [next year],' he said.
'And the situation will get worse in 2004.'
He said the situation would put the company in a better position when it negotiated with mainland smelters for long-term raw-material procurement contracts.
Many extrusion factories in China had been hit by the recent rise in the price of raw materials, which could give his firm acquisition opportunities.
He expected the company to expand its production capacity from last year's 120,000 tonnes to about 200,000 tonnes next year.
Mr Chan also said yesterday that the company's curtain wall systems testing chamber facilities at Nanhai, Guangdong province, had recently been accredited by Hong Kong's Innovation and Technology Commission.
