SMM, September 3 –
In August 2026, the national weighted average full cost of alumina stood at RMB 2,731/mt, up RMB 14/mt month-on-month, while the weighted average cash cost came in at RMB 2,558/mt. The cost continued its upward trajectory in August, driven jointly by the ore and energy segments: ore costs edged higher, with imported ore prices rising modestly and domestic ore remaining at elevated levels; on the energy front, coal prices stayed high on the back of prior events, lending support to the energy cost component; caustic soda prices, meanwhile, showed regional divergence with mixed movements across regions, remaining largely stable on a month-on-month basis. Overall, ore and energy contributed incremental cost pressure, while caustic soda had a neutral impact, resulting in a modest cost increase for the month.
Breaking down by cost components:
Bauxite: August saw a slight increase in overall ore costs. Imported ore prices from various source countries generally rose by about USD 1/mt, a relatively moderate gain. Combined with higher ocean freight and a slight contraction in the USD/CNY exchange rate compared with July, landed costs were nudged higher. Domestic ore continued to hold at high levels, with prices flat month-on-month. On the supply side, although the traditional rainy season is underway, its disruption to shipments has been limited this year. August bauxite shipment volume surged 41% month-on-month, representing a significant expansion in supply availability. Under the dual effects of downstream price pressure and ample supply, the upside room for ore costs was effectively capped.
Caustic soda & energy: On the energy cost front, coal prices remained at relatively high levels due to previous events, providing sustained support to alumina energy costs. The caustic soda market exhibited a distinctly regional divergence: Guangxi's liquid caustic soda procurement price fell by RMB 150/mt in August, while northern regions including Shanxi and Henan saw procurement prices rise by RMB 50–100/mt. Overall, prices were essentially flat month-on-month, exerting a neutral impact on August costs. Looking ahead to September, upward pressure on the caustic soda side is emerging: Guangxi's liquid caustic soda procurement price has risen by RMB 50/mt, Shanxi by RMB 70/mt, and Henan by RMB 50/mt. Caustic soda costs are expected to gradually strengthen in September, adding fresh incremental pressure on the alumina cost structure.
In summary, with ore costs edging up modestly, energy costs remaining elevated, and caustic soda prices gradually firming, the national weighted average full cost of alumina is projected to run in the range of RMB 2,730–2,850/mt in September, with the weighted average cash cost expected to range between RMB 2,550 and RMB 2,670/mt.
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