[SMM Morning Comment on Alumina: Fundamentals Show Mixed Signals, Alumina Expected to Fluctuate]
Overall, supply side, some alumina refineries in northern regions reported maintenance this week, which may slightly impact alumina supply in the short term. Weekly operating rates of alumina dropped slightly by 0.33 percentage points this week. Demand side, some aluminum production cuts and technological transformation capacities in Sichuan and other regions may gradually resume production, leading to an increase in alumina demand. Cost side, due to the sharp decline in spot alumina prices, alumina refineries have significantly reduced their acceptance of high-priced bauxite, and bauxite holders have also lowered their quotations. Imported bauxite prices fell, potentially reducing alumina production costs. However, the current spot transaction prices of alumina in northern regions are below the theoretical marginal production cost.
Overall, large-scale production cuts in alumina have not yet occurred, and the spot alumina market remains relatively well-supplied. Spot transaction prices are expected to fluctuate in the short term.
