Higher prices boost domestic aluminum production

Higher aluminum prices have prompted some Chinese smelters to abandon production cutbacks and are seen leading to restarts of other plants, chipping away at what was expected to be the first global deficit after years of oversupply.

A rally in London Metal Exchange futures contracts this year plus record premiums, or charges to obtain physical material, have sharply improved the financial stance of many smelters that were in the red last year.

"The profitability of the industry has dramatically improved this year, from losing money to being cash-positive ... so the next risk is to get restarts," Stephen Briggs, a metals strategist at BNP Paribas in London, said.