WEEKLY: Chinese alumina prices rise on bauxite supply risks, tight alumina availability

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According to Mysteel's assessment, the weighted national average spot price for smelter-grade alumina with a minimum purity of 98.6 per cent was at RMB 2,730 per tonne (USD 404 per tonne) on June 11, up by 1 per cent on week.

The firmer spot prices were largely driven by market anticipation that Guinea would this month announce measures to restrict bauxite exports. The expected curbs also lent support to the futures market. On June 11, the most-traded September alumina contract on the Shanghai Futures Exchange closed the daytime session at RMB 2,899 per tonne, marking a 5 per cent increase from a week earlier.

In addition, tight alumina availability in certain regional markets such as the Guangxi autonomous region also underpinned prices, as alumina production cuts made previously have not been relaxed and newly commissioned capacity has yet to translate into spot availability.

During the week, domestic alumina output remained broadly stable. The 44 alumina refiners tracked by Mysteel produced 1.8 million tonnes over June 5-11, up by a marginal 0.1 per cent from a week earlier, according to Mysteel's weekly survey.

Meanwhile, the widening spread between spot and futures prices dampened trading activity, contributing to rising inventories at delivery warehouses, market watchers said. 

Overall inventory levels continued to build, albeit at a slower pace. As of June 11, total alumina stocks across China's ten ports, 44 alumina producers, 89 primary aluminium smelters, and rail yards or in transit had reached 6.2 million tonnes, up 0.3 per cent on week, slightly below the 0.4 per cent growth recorded in the prior week.

Note: This news is published under a content and exchange agreement with Mysteel