Maintenance and Production Cuts Lead to Short-Term Supply Tightening, Alumina Prices Halt Decline and Rebound [SMM Alumina Morning Comment]

SMM Alumina Morning Comment 4.24

Futures: During the night session, the most-traded alumina 2509 contract opened at 2,870 yuan/mt, reached a high of 2,876 yuan/mt, a low of 2,850 yuan/mt, and closed at 2,862 yuan/mt, up 17 yuan/mt, a gain of 0.60%, with open interest at 212,000 lots.

Ore: As of April 23, the SMM imported bauxite index stood at $86.88/mt, unchanged from the previous trading day; the SMM Guinea bauxite CIF average price was $86/mt, unchanged from the previous trading day; the SMM Australia low-temperature bauxite CIF average price was $87/mt, unchanged from the previous trading day; the SMM Australia high-temperature bauxite CIF average price was $80/mt, unchanged from the previous trading day.

Spot Alumina: On Wednesday, 5,000 mt of alumina was traded in Guizhou at a transaction price of around 2,950 yuan/mt; 2,000 mt of alumina was traded in Henan at a transaction price of 2,920 yuan/mt.

Industry News:

1. The Ministry of Ecology and Environment held a regular press conference today. Spokesperson Pei Xiaofei stated that the ministry recently issued the "Notice on the Work Related to the National Carbon Emission Trading Market in 2025," which clearly requires the management of key emission unit lists, carbon emission data quality, and quota allocation and settlement for the power generation, steel, cement, and aluminum smelting industries, along with their respective deadlines. According to the notice, units with annual direct emissions reaching 26,000 mt of carbon dioxide equivalent (CO2e) will be included in the key emission unit list and managed under the national carbon market, no longer participating in local carbon market management. The next step for the Ministry of Ecology and Environment is to strengthen overall coordination, provide comprehensive training for newly included enterprises, increase supervision and law enforcement, and severely crack down on data fraud to ensure the healthy and orderly development of the carbon emission trading market.

Spot-Futures Price Spread Report: According to SMM data, on April 23, the SMM alumina index was at a premium of 55 yuan/mt against the latest transaction price of the most-traded contract at 11:30.

Warrant Report: On April 23, the total registered volume of alumina warrants decreased by 6,015 mt to 282,500 mt compared to the previous trading day. The total registered volume of alumina warrants in Shandong remained unchanged at 3,307 mt, in Henan decreased by 1,501 mt to 6,600 mt, in Guangxi remained unchanged at 41,700 mt, in Gansu decreased by 1,503 mt to 15,000 mt, and in Xinjiang decreased by 3,011 mt to 215,900 mt.

Overseas Market: As of April 23, 2025, the FOB alumina price in Western Australia was $348/mt, the ocean freight rate was $20.55/mt, and the USD/CNY exchange rate selling price was around 7.31, translating to a domestic mainstream port selling price of approximately 3,126 yuan/mt, 237 yuan/mt higher than the domestic alumina price, keeping the alumina import window closed.

Summary: Due to the concentrated maintenance of alumina refineries in April, the operating capacity of alumina has continued to decline, dropping to 82.88 million mt/year as of last week, tightening alumina supply in the short term and halting the decline in alumina prices, with a slight rebound in northern alumina prices. Recently, some companies have gradually completed their maintenance, and new maintenance and production cut events have also occurred. Short-term prices are expected to fluctuate mainly. With the gradual completion of maintenance and the commissioning of new capacity, the operating capacity of alumina is still expected to rebound, but medium and long-term alumina prices remain under pressure.

[The information provided is for reference only. This article does not constitute direct advice for investment research decisions. Clients should make decisions cautiously and not use this as a substitute for independent judgment. Any decisions made by clients are unrelated to SMM.]