
Alumina prices continued to decline across China, facing pressure from higher operating capacity, potential surge in domestic supply, and falling prices of primary aluminium, according to Shanghai Metals Market.
On Friday, June 15, 2018, the price of alumina averaged RMB 2812 per tonne, down RMB 92 per tonne from a week ago, according to SMM assessment. This marked a decline for four weeks in a row. In Shanxi and Henan province, the traded price dropped below RMB 2800 per tonne, SMM believed.
{alcircleadd}However, according to Shanghai Metals Market, alumina operating capacity is likely to increase another 1 million tonne per year from July. Some 100,000 tonnes of bagged alumina at Guangxi ports also ramped up the likelihood of sale in the domestic market.
The incessant drop of primary aluminium price could also be attributed to the cause of alumina price decline and the slowdown of downstream demand for alumina.
As on Tuesday morning, June 19, the alumina price declined further to RMB 2795 per tonne from RMB 2812 per tonne. While in the east, the alumina price dropped from RMB 2870 per tonne to RMB 2860 per tonne; in central and north, the prices dropped from RMB 2800 per tonne to RMB 2790 per tonne and from RMB 2795 per tonne to RMB 2785 per tonne respectively. The South market stood as no exception but saw a maximum plunge compared to the other markets. The price there plunged from RMB 2870 per tonne to RMB 2815 per tonne.

The average A00 aluminium ingot price, on the other hand, also saw a marginal decline on Tuesday morning, June 19, from RMB 14340 per tonne to RMB 14330 per tonne, according to SMM. The prices are expected to range between RMB 14310 per tonne and RMB 14350 per tonne, with spot discounts to settle at RMB 80 to RMB 40 per tonne.
The continuous fewer deliveries in the aluminium primary market in China weighed on aluminium inventory, causing a decline in aluminium ingot price, as a result. As of June 19, China’s primary aluminium inventory, including SHFE warrants extended its decline over the weekend and stood at 1.89 million tonnes, after shrinking 32,000 tonnes from last Thursday.
The details of primary aluminium inventory movements across the Chinese market are as follows.

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