China's only producer of alumina, Chalco, raised prices a further 12.1% in mid-December, putting pressure on the country's aluminum smelters who already face widespread power shortages.
The price rise for the raw material used to make aluminum was the seventh increase in 2003, pushing the price 94.7% higher than that at the end of 2002. Aluminum prices also rose but at a much slower rate.
China's more than 135 aluminum smelters were estimated to have raised capacity 39.4% in 2003 but capacity expansion was expected to slow to 16.7% in 2004 and 11.4% in 2005, the China Nonferrous Metals Industry Association said.
Since 2001, China has been the world's largest exporter of aluminum. Only 17 smelters have an annual production capacity of more than 100,000 tons.