China alumina spot prices decline further; plants start executing production limit policy

Alumina spot prices in China domestic market are extending their declines. The average alumina spot price dropped by RMB 19 per tonne to stand at RMB 3496 per tonne, as on November 27. As updated by Shanghai Metals Market, average spot prices of one of aluminium’s key raw materials registered drop by RMB 15-20 per tonne on Monday to range at RMB 3460-3500 per tonne.

The spot alumina prices in the domestic market as on November 27 are as follows:

Unit: RMB per tonne

Chalco average alumina price, however, remains unchanged at RMB 3770 per tonne. Imported alumina price also flat at RMB 3700 per tonne as on November 27.

After production limit for heating season was implemented on November 15, alumina plants in China major regions have practiced the policy. As per SMM update, actual limited alumina refining capacity as on November 24 stood at 5.19 million tonnes per year, which accounts for only 57 per cent of the estimated limited capacity.

The actual limited capacity includes 400,000 tonnes flexible limited capacity of Jinzhong City, Shanxi Province, which may change depending on weather conditions. There into, Shanxi and Henan practice production limit as per requirement, SMM said.

Unit: Thousand ton per year

Source: metal.com

Taking imported alumina into account, the demand-supply seems to be in balance in the domestic market. But due to circulating goods the market has moved into a surplus currently, which is weighing down the alumina spot prices. SMM thinks alumina prices will improve once the third-party inventory has been used up.