After a period of flat run, China’s domestic alumina price rebounded on August 17, driven by an outlook on tightened supply. The average spot alumina prices expected to range between RMB  2506 – 2506/t. The tightness in the market is expected because Alumina production in Shanxi province has been affected by suspension of some bauxite mines in Shanxi and Henan provinces on environmental regulations.

China Aluminium International Trading, the wholly owned subsidiary of Aluminium Corp of China (Chalco), published a public tender to purchase 90,000 tonnes of alumina, strengthening market anticipation of tightened supply in the nearby market.

Australian Alumina FOB prices rose timidly in recent weeks as market participants tempered their expectations that China would comply with the announced cuts to illegal aluminium capacity.

While global aluminium prices trade at multi-year highs on China’s efforts to cut illegal capacity on stricter environmental and policy regulations, the leading alumina exporter from India is Nalco is still positive about alumina demands in the near term.

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In an interview to CNBC-TV18, TK Chand, CMD of NALCO said that alumina prices are currently subdued because of the news of aluminium capacity cut and slow demand in China.

He expects Nalco’s alumina production to be in surplus in coming fiscal. He however, expects alumina prices to move up by another USD 10-15 in the near term. He also expects higher prices of caustic soda to support aluminium prices. The company expects to make profitable business in alumina segment in the coming fiscal.