Primary Aluminium Weekly Recap: LME aluminium price gains US$55/t to stand at US$2602/t; China’s aluminium production grows 1.86% in July

Right from the hike in LME aluminium benchmark price to new consumption restrictions on Chinese aluminium producers, primary aluminium market has spotted some of the important news this week.

From US$ 2,547 per tonne on Monday, August 9, both LME aluminium cash (bid) price and LME official settlement price increased to US$ 2,602 per tonne on Thursday, August 12, reflecting a hike of US$ 55 per tonne. 3-months bid price and 3-months offer price grew from US$ 2,553 per tonne to US$ 2,600 per tonne, while Dec 22 bid price and Dec 22 offer price climbed from US$ 2,517.50 per tonne to US$ 2,577.50 per tonne.

To know more: https://www.alcircle.com/news/lme-aluminium-price-gains-us24-t-to-stand-above-us2600-t-shfe-price-continues-to-decline-to-us3090-t-70088

A00 aluminium ingot price in China jumped US$ 160 per tonne through this week to close above RMB 20,000 per tonne. According to the Shanghai Metals Market, A00 aluminium ingot price stood at RMB 20,050 per tonne as of Friday, August 13, with average prices expected to range between RMB 20,030 per tonne and RMB 20,070 per tonne.

To know more: https://www.alcircle.com/news/a00-aluminium-ingot-price-in-china-grows-by-rmb30-t-to-close-the-week-at-rmb20-050-t-smm-70089

Guangxi Power Grid Corp sent a notice directing aluminium smelters in Guangxi region to reduce average electricity loads by more than 30 per cent by August 15. This move came as a part of the effort to cut electricity usage during peak times, said consultancies AZ China and MySteel.

This new power consumption restriction imposed on aluminium producers by southern China’s Guangxi region could temporarily shut down about half a million tonnes of annual smelting capacity, pointed out consultancies.

To know more: https://www.alcircle.com/news/guangxi-power-grid-corp-imposes-power-consumption-restrictions-on-aluminium-producers-likely-to-affect-half-a-million-tonnes-of-smelting-capacity-69065

The Malaysian aluminium producer, PRESS Metal Aluminium Holdings Bhd’s Q2 2021 earnings are estimated to escalate 30%-40% to RM265-RM285 million, which is triggered by a higher London Metal Exchange (LME) spot average of $2,400 per tonne and enhanced smelting output.

Lester Siew, an RHB analyst, said: “We expect the first half of 2021 (1H21) core profit to rise 150% year-on-year (YoY) with 2Q21 forecast (2Q21F) earnings up 30%-40% quarter-on-quarter on stronger LME aluminium prices, alongside improved sales volumes as production picks up at its Samalaju Phase 3 smelter by 320 kilotonnes per annum.”

To know more: https://www.alcircle.com/news/press-metals-earnings-to-escalate-in-q2-driven-by-higher-aluminium-price-rhb-investment-bank-bhd-69060

According to SMM report this week, China’s aluminium production in July 2021 grew 1.86 per cent month-on-month to stand at 3.28 million tonnes. However, the average daily output edged lower on a month by 1 per cent to 106,000 tonnes in the said month.

The output totalled 22.75 million tonnes from January to July, an increase of 7.65 per cent from 21.13 million tonnes during the same period last year. The dip in daily average output could be attributed to the power curtailment and flood in Henan that caused two local aluminium plants to reduce or suspend production.

To know more: https://www.alcircle.com/news/chinas-aluminium-production-grows-1-9-m-o-m-and-5-y-o-y-to-3-28-million-tonnes-in-july-2021-smm-69067

The first primary aluminium producer of Oman, Sohar Aluminium, jointly owned by OQ Group, Abu Dhabi National Energy Company PJSC - TAQA and Rio Tinto Alcan, stated that it closed the financial book of pandemic stressed 2020 with “positive bottom-line results” amid a collapse in global aluminium prices on the London Metal Exchange (LME) in 2020. The world-scale aluminium smelter in Sohar described 2020 as an “abnormal year” that sent aluminium prices on the LME tumbling to below $1500 per tonne during Q2 2020.

The company stated in its 2020 Sustainability report: “Despite difficult market situations, SA concluded the year with positive financial results above Business Plan supported by lower cost of production coupled with an increase in production volume.”

To know more: https://www.alcircle.com/news/omans-sohar-aluminium-closes-2020-financial-book-with-positive-bottom-line-results-70076

China’s social inventories of primary aluminium gained 7,000 tonnes across eight major consumption areas, including SHFE warrants, to stand at 739,000 tonnes as of Thursday, August 12.  In Wuxi, primary aluminium inventories increased by 12,000 tonnes week-on-week to stand at 268,000 tonnes, while the inventories in Nanhai and Tianjin grew by 5,000 tonnes and 1,000 tonnes to come in at 200,000 tonnes and 65,000 tonnes, respectively.

To know more: https://www.alcircle.com/news/primary-aluminium-inventories-in-china-grow-after-five-consecutive-weeks-of-decline-inventories-standing-at-739-000-tonnes-70084

As of August 13, Hindalco Industries Limited and Vedanta Limited increased their aluminium ingot prices by INR 1,500 per tonne. That brought Hindalco’s aluminium ingot price to INR 224,500 per tonne and Vedanta’s aluminium ingot price to INR 225,000-238,000 per tonne.

To know more: https://www.alcircle.com/news/hindalcos-aluminium-ingot-price-sees-another-hike-this-week-to-reach-at-inr-224-500-t-70094

https://www.alcircle.com/news/vedanta-limited-continues-to-grow-aluminium-ingot-price-by-inr1500-t-w-e-f-august-13-70091

This week, AlCircle launched a new report on "Outlook for the Indian Aluminium Industry” - In-depth industry analysis & forecast to 2026-27” to evaluate the aluminium industry market amid the COVID-19 pandemic and to project its trend to 2026-27.

To know more: https://www.alcircle.com/news/alcircle-launches-new-report-outlook-for-the-indian-aluminium-industry-in-depth-industry-analysis-forecast-to-2026-27-69075