SMM analysis on China August alumina production and September forecast

According to SMM data, China's metallurgical-grade alumina production in August 2024 (31 days) increased slightly by 0.67% MoM, but decreased by 2.82% YoY. By the end of August, China's existing capacity for metallurgical-grade alumina remained stable, with the actual operating capacity up 0.81% MoM, and the operating rate at 84.63%. From January to August 2024, the total production of domestic metallurgical-grade alumina increased by 3.79% YoY.
By region:
Shanxi: The operating rate in August was 78.1%, down 1.4% from July, mainly due to tight ore supply and production line issues;
Henan: The operating rate in August was 63.9%, down 6.0% from July, mainly due to tight ore supply and production line maintenance at some alumina refineries;
Guizhou: The operating rate in August was 77.4%, down 2.9% from July, mainly due to a shutdown for maintenance at an alumina refinery on August 2, involving an annual capacity of 1 million mt, with an expected maintenance period of about one week;
Hebei: The operating rate in August was 103.3%, up 5.2% from July, mainly due to the completion of a half-month equipment maintenance at a local alumina refinery, involving a capacity of 1 million mt, which has recently resumed full production;
Guangxi: The operating rate in August was 89.4%, down 0.6% from July;
Shandong: The operating rate in August was 95.7%, up 3.3% from July, mainly due to the completion of previous production line maintenance at a local alumina refinery, which is now gradually resuming production, involving an annual capacity of 200,000 mt.
September forecast:
The SMM survey shows that the resumption of capacity in Inner Mongolia and the new capacity in Chongqing will gradually come online in September. However, alumina refineries in Hebei and Henan have announced maintenance plans, which may affect over 1.5 million mt/year of capacity. Therefore, it is expected that the daily average output of alumina in China will decline in September. On the raw material side, there is no further news on the resumption of domestic ore production, and supply remains tight. The supply of imported ore is expected to decrease due to the rainy season in Guinea. Overall, the supply of bauxite remains tight, limiting the increase in operating capacity for alumina. SMM expects that the daily average production of metallurgical-grade alumina in China will increase by 2.9% YoY in September 2024. Continuous attention is needed on alumina demand from aluminium resumption in south-west China and the pace of new and resumed alumina capacity coming online.