China’s alumina output to grow in May: How realistic is the estimate?

Estimated alumina output derived from China’s domestic production data is expected to improve this month. The country which reported 31.6 million tonnes of aluminium output in 2016 against the world total of 58.8 million tonnes (53.7 per cent) is estimated to produce 5.82 million tonnes of alumina in May. But given the current maintenance work at China alumina refineries how realistic does this estimate sound?

Market watchers opine that the actual China alumina output in May is likely to be lower than what is forecasted. In fact, it is going to be even lower than March’s alumina output level since more producers would start maintenance work at their plants if alumina prices keep falling at the current pace.

China’s alumina output in April grew at 23.3 per cent rate year-on-year to reach 5.7 million tonnes. The country’s daily average output edged higher by 0.3 per cent month-on-month to stand at 190,000 tonnes, SMM statistics showed.

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Only a handful of alumina producers who managed to see profits stepped up production. Most SMEs began suffering losses from mid-April. Shanxi Xiaoyi Taixing Aluminum Magnesium shifted to aluminum hydroxide production in mid-April. Menxi Aluminum in Inner Mongolia closed in April and has no plans to resume production before July. East Hope Jinzhong Chemical also put its one million-tpy line under maintenance in late April and early May. Shanxi Xiaoyi Tianyuan Chemical put three lines under maintenance in May. 

No wonder, given the recent trend of operations suspension alumina output will drop in the short-term.

China churned out a total of 5.87 million tonnes of alumina in March as some big producers ramped up production, SMM data showed.