Middle East tensions escalate again, rising ocean freight rates drive up imported ore costs, market transactions cool down [SMM bauxite weekly review]

SMM, September 17:

Domestic bauxite:

Domestic ore supply disruptions persist, mainstream prices remain stable

Domestic ore prices were broadly stable with no significant fluctuations, and the market is expected to trade around current price levels in the near term. As of today, ex-warehouse transaction prices for bauxite with an Al/Si ratio of 5.0 and 60% alumina content, excluding VAT, at crushing plants in Shanxi were around 530-550 yuan/mt; in Henan, ex-warehouse transaction prices for bauxite with an Al/Si ratio of 5.0 and 60% alumina content, excluding VAT, at crushing plants were around 500-540 yuan/mt; in Guiyang, ex-works prices for bauxite with an Al/Si ratio of 6.0 and 60% alumina content, including VAT, were 490-540 yuan/mt; in Guangxi, ex-warehouse transaction prices for bauxite with an Al/Si ratio of 6.0 and 53% alumina content, excluding VAT, at crushing plants were 320-335 yuan/mt.

Imported bauxite:

Middle East tensions escalate again, Guinea-to-China ocean freight rates continue to climb

According to data from September 11, weekly bauxite port departures from main ports in Guinea totaled 5.5696 million mt, up 1.8784 million mt from the previous week, with shipments rebounding. According to an SMM survey, during Q3 2026, the impact of Guinea's traditional rainy season on shipments was relatively limited. In mid-September, as Middle East tensions escalated again and demand for shipping capacity from other cargoes increased, Guinea-to-China ocean freight rates rose to around $39-42/wmt, and shipping costs for various mines continued to consolidate at highs. In Australia, as of September 11, weekly bauxite port departures from main ports totaled 1.2856 million mt, up 80,700 mt from the previous week, with shipments basically stable. Attention should be paid to the shipment pace of Australian mines and changes in port departures. As of September 11, China's bauxite port arrivals totaled 4.9614 million mt, up 1.5265 million mt from the previous week. Continued attention should be paid to the impact of high and fluctuating oil prices and ocean freight rates on future arrival pace and landed costs.

In terms of prices, Guinea's September bauxite long-term contract offers continued to settle in the $72-74/mt range, and downstream price acceptance remained relatively limited. Meanwhile, alumina prices remained at a relatively high level, with days of inventories at around 94 days, exerting some top-side pressure on ore prices. For Guinean bauxite, although Guinea-to-China ocean freight rates maintained an upward trend and mine costs continued to consolidate at highs, Guinea maintained high bauxite shipment levels overall in August, and domestic alumina refineries' intended purchase prices remained at a low of $71-72/mt, with overall imported ore prices broadly stable at around $72/mt. Shipments from various mines in Guinea remained largely stable, while imported ore prices continued to be contested and transaction activity weakened somewhat. As of Thursday this week, FOB quotes for Guinean bauxite were $35-45/mt, with the average price flat WoW; CIF prices for Guinean bauxite were quoted at $70-73/mt, with the average price flat WoW; the SMM imported bauxite index price was reported at $72.35/mt, up $0.28/mt from last Thursday. Going forward, bauxite prices will still depend on cost conditions at individual mines, the traditional rainy season in Guinea, and the impact of the Guinean government's bauxite export quota policy on overall shipments. SMM will continue to closely monitor bauxite market trends and transaction activity.

Overall, domestic ore market prices remained at current levels; meanwhile, inventory at domestic alumina refineries remained high (around 94 days), and alumina enterprises showed moderate tolerance for rising raw material prices. Uncertainty over Guinea's quota policy and the traditional rainy season also provided some support to bauxite costs, but buyers' purchase willingness and the rebound in shipments exerted downward pressure on imported bauxite prices. In the short term, after a slight pullback in imported ore prices, the market is expected to continue in a standoff, with close attention needed on the implementation of Guinea's quota policy and ocean freight rate trends.