Chinese alumina prices largely tracked higher in the spot market on February 27, while alumina futures in Shanghai weakened further the same day. The domestic alumina market is expected to remain volatile in the near term amid rising market concerns following the US and Israeli strikes on Iran over the weekend, which could affect China's alumina exports and disrupted alumina supply in the Middle East.

According to Mysteel's daily price assessment, the national average spot price for metallurgical-grade alumina with a minimum purity of 98.6 per cent rose for the fourth consecutive working day, up RMB 5 per tonne ($0.7/t) from last Thursday to stand at RMB 2,659 per tonne, including 13 per cent VAT last Friday.

The assessed regional prices for the same grade of alumina increased across three of China's five major alumina production hubs on Friday. In Shanxi and Henan, the prices edged up by RMB 10 per tonne on day to RMB 2,635 per tonne and RMB 2,645 per tonne, respectively, and those in Shandong inched up by RMB 5 per tonne from the previous day to RMB 2,590 per tonne. Meanwhile, price assessments in Guizhou and Guangxi remained stable, averaging between RMB 2,685 per tonne and RMB 2,740 per tonne.

In the physical market, supply reductions in North China constrained alumina deliveries under long-term contracts, prompting some primary aluminum smelters with urgent restocking needs to enter the spot market toward the end of last week. At the same time, alumina producers and traders largely held firm on pricing, with some lifting their offers amid tighter prompt availability.

For the global aluminium value-chain 2026 outlook, book our exclusive report “Global ALuminium Industry Outlook 2026"

Mysteel heard of three deals concluded on Friday and Saturday. On Friday, a trader purchased 3,000 tonnes of spot alumina from a Henan-based producer at RMB 2,700 per tonne EXW including VAT. On Saturday, another producer in Henan sold 15,000 tonnes to traders and primary aluminum smelters at RMB 2,650-2,670 per tonne EXW including VAT, while an additional 5,000 tonnes were sold by a trader to a smelter in Guangxi at RMB 2,730 per tonne EXW including VAT.

Meanwhile, domestic alumina futures on the Shanghai Futures Exchange continued to lose ground. The most-traded May alumina contract fell by 3.65 per cent during Monday's daytime trading session and declined by a further 0.4 per cent overnight, with the nighttime session closing at RMB 2,746 per tonne as of 1 a.m. last Saturday.

In the early hours of Saturday, the US and Israel launched military strikes against Iran, and Tehran soon fought back with a barrage of missiles that struck multiple US bases across the Gulf region, and the Strait of Hormuz – a vital transit route for global oil trade - was effectively "closed" thereafter. Although Iran has only one alumina refiner, the country and the five other Middle Eastern countries surrounding the strait form one of the world's most concentrated regions for primary aluminum production capacity, according to market analysts.

Don't miss out- Buyers are looking for your products on our B2B platform

If shipping through the strait remains closed, imports of alumina and bauxite into the Middle East could be significantly affected, market analysts added. This may force primary aluminum smelters in the region to implement production cuts or even temporary shutdowns due to raw material shortages. China's alumina exports to the Middle East could also be hindered, potentially closing the export window and weighing on domestic alumina prices despite the recent firmness in the spot market.

Note: This article has been issued by Mysteel and has been published by AL Circle with its original information without any modifications or edits to the core subject/data.