Upstream aluminium recap: World alumina output hits record; Analysts expect volatile market with new trade policies
Updates like record-high alumina production in October, Antam committing $723 million for mining expansion, and global aluminium producers offering 31-49 per cent higher shipment premium to Japanese buyers have taken the aluminium industry by storm this week, indicating an increasing effort towards upstream aluminium production amid a critical supply-chain flow due to revised trade policies. The ongoing gap between demand and supply is likely to increase with the implementation of policies like China’s aluminium export tax rebate cancellation or the United States’ increased tariffs on Mexico, Canada, and China.
On Monday, November 25, US President-elect Donald Trump reaffirmed on social media that he would impose 25 per cent tariffs on all imports from Mexico and Canada, the United States’ two most significant trading partners as the largest suppliers of aluminium and steel. Trump also plans to impose an additional 10 per cent duty on all products sourced from China.
China’s products, particularly sol-gel alumina-based ceramic abrasive grains, will also face a tariff hit, as proposed by a US company Saint-Gobain Ceramics & Plastics, Inc. This week the firm filed a petition seeking to impose antidumping and countervailing duties on China’s sol-gel alumina-based ceramic abrasive grain imports The move is aimed at addressing what the company claims are unfair trade practices that have impacted the U.S. abrasive grain market.
To know more: https://www.alcircle.com/news/saint-gobain-pushes-for-tariffs-on-sol-gel-alumina-abrasive-imports-from-china-112678
To meet the global demand and mitigate the supply-chain disruption of raw material, the global production of alumina increased and touched a new high, marking a M-o-M increase of 5.6 per cent and Y-o-Y surge of 12.17 per cent. The daily average output also exceeded all the previous records, reflecting a month-on-month increase of 2.26 per cent.
However, the limited raw material supply causing price surge has made RUSAL taking a decision to cut 6 per cent primary aluminium production annually. UC Rusal, the world’s second-largest aluminium company by primary metal output, explicitly said it would reduce its production by 250,000 tonnes. This decision followed alumina output suspensions in Australia, the world’s second-largest alumina producer, upon bauxite supply disruptions from Guinea and Brazil.
Like alumina producers are increasing their output to meet the demand in the primary aluminium sector, bauxite miners are also planning expansions to ramp up the output to support alumina refineries. Such initiatives are seen this week when PT Aneka Tambang (Antam), a member of PT Mineral Industri Indonesia (Persero) or MIND ID, said it has earmarked a significant capital expenditure (Capex) of $723 million (Rp11.46 trillion) to invest in accelerating bauxite exploration. Antam’s General Manager, Abdul Bari, emphasised the company’s commitment to sustainable growth, noting that Antam will maintain its exploration budget at over 1 per cent of total production income.
To know more: https://www.alcircle.com/news/pt-aneka-tambang-antam-commits-723-million-for-mining-expansion-aims-for-long-term-growth-112680
Tianshan Aluminum Company is also steadily advancing its bauxite mining and shipment project after the successful equity acquisition of local mining companies in Guinea. The project has now entered the large-scale mining phase, with products being shipped to China progressively. This development is expected to significantly support the company's alumina production needs and bolster its future raw material self-sufficiency.
To know more: https://www.alcircle.com/news/tianshan-aluminum-strengthens-raw-material-supply-with-bauxite-mining-expansion-in-guinea-112665
Aluminium Corporation of China Limited, popularly known as Chinalco, a state-owned multinational company, is likely to invest around $426 million in bauxite mining in Suriname, said the chairman of a Surinamese presidential mining commission on Monday, November 25.
To know more: https://www.alcircle.com/news/suriname-bauxite-project-attracts-chinalco-chinese-miner-agrees-to-pump-in-426-million-112654
Arrow Minerals (ASX: AMD) has affirmed mineralisation, as hypothesised earlier, over a 2-kilometre strike, resulting from its first drilling at the Niagara Bauxite Project in Guinea. Emphasised intersections include 7 metres at 47.1 per cent aluminium oxide (Al₂O₃) and 2.9 per cent silica (SiO₂) from the surface and 10 metres at 46.6 per cent Al₂O₃ while 7.9 per cent SiO₂ from the surface.
To know more: https://www.alcircle.com/news/arrow-minerals-affirms-mineralisation-in-three-niagara-bauxite-project-sites-112647
Rio Tinto Group said it is removing the halt on alumina exports from its Gladstone refineries in Australia. This decision followed the company’s report in the Q3 results that its gas supplies were satisfying about 95 per cent of necessities, while alumina production for the quarter was 7 per cent lower Y-o-Y at 1.77 million tonnes.
To know more: https://www.alcircle.com/news/rio-tinto-back-to-fulfilling-commitments-after-lifting-operational-force-majeure-112641
Anticipating primary aluminium supply crunch in Asia following the 13 per cent tax rebate cancellation for aluminium semi-manufactured products by the Chinese government from December 1, 2024, global aluminium producers have offered 31 to 49 per cent higher shipment premium to Japanese buyers for Q1 2025.
Amid the on-going volatile market, Bank of America has projected the continuity of turbulent year ahead for the metals and minerals market in 2025, driven by shifting trade policies, supply constraints, and fluctuating global demand, creating an unpredictable landscape for investors and industries. Aluminium and copper, two critical industrial metals, are expected to face notable price declines.
For a comprehensive understanding of Uday Patel's insights on various aspects of geopolitical dynamics and their impact on the European aluminium market, please refer to the full interview here.
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