China’s A00 aluminium ingot price surges by RMB640/t following Rio Tinto’s force majeure declaration; Low-carbon aluminium price expands to RMB22721/t

According to the Shanghai Metals Market survey, China's A00 aluminium ingot price has surged by RMB 640 per tonne to clock at RMB 21,710 per tonne. The spot contract price is expected to be traded at a discount price of RMB 170 to RMB 130 per tonne, whereas the average prices may range between RMB 21,690 per tonne and RMB 21,730 per tonne.

As per the SMM data, the A00 aluminium ingot price has skyrocketed by RMB 3,360 per tonne or 18.31 per cent Y-o-Y from RMB 18,350 per tonne recorded on May 30, 2023. On a W-o-W calculation, the price hiked by RMB 960 per tonne or 4.62 per cent from RMB 20,650 per tonne.  

Reason for the growth in prices

One of the main reasons for the price surge can be attributed to the gas shortage-led force majeure declared by Rio Tinto on alumina shipments from its operations in Queensland, Australia. This has raised concerns about supply from the world's second-largest producer. Additionally, uncertain weather conditions in China's Yunnan province threatened the availability of hydroelectric power for aluminium producers, further exacerbating supply worries. Significant changes in aluminium stocks compounded this situation.

Region-wise growth for A00 aluminium ingot

Today, the prices in Foshan, Hangzhou and Chongqing have soared by RMB 630 per tonne to halt at RMB 21,600 per tonne, RMB 21,690 per tonne and RMB 21,630 per tonne. In Wuxi and Shenyang, the domestic aluminium ingot prices have expanded by RMB 620 per tonne to peg at RMB 21,690 per tonne and RMB 21,610 per tonne. In Tianjin and Gongyi, the prices have gained RMB 570 per tonne and RMB 560 per tonne, respectively, to stand at RMB 21,630 per tonne and RMB 21,530 per tonne. In Linyi, the price has increased by RMB 550 per tonne to RMB 21,610 per tonne.

Other prices

The domestic price of low-carbon aluminium has also witnessed a significant expansion of RMB 623 per tonne as of today to dock at RMB 22,721 per tonne.  On the same day, the high-purity aluminium (99.99%) price and high-purity aluminium (99.996%) price have hiked by RMB 600 per tonne to stand at RMB 29,100 per tonne. The aluminium powder price has added RMB$0.6 per kg to arrive at RMB24.4 per kg.

The price of Australian alumina FOB has gained US$7 per tonne to stand at US$457 per tonne. For aluminium alloys (ADC12) and aluminium alloy (A380), the prices have gained RMB 200 per tonne to peg at RMB 20,750 per tonne and RMB 21,750 per tonne. For (ADC12) the average prices may stand between RMB 20,650 per tonne and RMB 20,850 per tonne. On the same day for (A380), the average prices are expected to orbit between RMB 21,650 per tonne and RMB 21,850 per tonne.