China spot alumina prices fall on expected Xinjiang smelter cuts

<p>China&rsquo;s spot alumina prices fell Thursday, April 20, on the back of news this week that Xinjiang smelters in northwest China will be cutting around two million mt/year of new aluminium capacity which have yet to receive required government approvals.</p> <p>The ex-works Shanxi daily spot alumina assessment by S&amp;P Global Platts stood at Yuan 2,350/mt ($342/mt) full cash terms, down Yuan 50/mt day on day, Yuan 60/mt lower week on week and a fall of Yuan 350/mt from a month ago.</p> <p><img style="vertical-align: middle; display: block; margin-left: auto; margin-right: auto;" src="http://www.alcircle.com/uploads/images/alumina-powder-500x500.jpg" alt="News" width="480" height="345" /></p> <p>A spot trade was heard done at Yuan 2,350/mt cash to full credit terms, ex-works Henan basis for 20,000 mt of refiner East Hope&rsquo;s alumina sold to a trader, market participants said.</p> <p>Refiners, traders and smelters said Yuan 2,350/mt cash was the current market clearing rate for both Henan and Shanxi spot alumina.</p> <p>A source from East Hope denied having done the trade but did not rule out that the company&rsquo;s alumina may have been traded via other channels at Yuan 2,350/mt.</p> <p>Another Henan refiner who also heard of the trade said it was &ldquo;very possible due to East Hope&rsquo;s anticipated Xinjiang smelter cuts&hellip;even though it has not started, they will have extra supply so that is definitely a pressuring factor now.&rdquo;</p> <p>{googleAdsense}</p> <p>A third Chinese refiner/trader agreed, adding he expected this trade to further dampen alumina and push prices down even lower near term.</p> <p>A Shanxi refiner, however, continued to put spot prices closer to Yuan 2,400/mt cash &ldquo;as East Hope is not a pure refiner, they have a smelter and anticipated cuts, so their price may not be repeatable for others. But prices will reach the Yuan 2,300/mt levels soon, just maybe not now, not yet.&rdquo;</p> <p>The front-month aluminum contract on the Shanghai Futures Exchange closed at Yuan 14,250/mt, up from Yuan 13,935/mt last week and from Yuan 13,680/mt a month ago.</p>