SHANGHAI, Jul 6 (SMM) – The rally in alumina prices in China accelerated last week as market sentiment got a boost after the aluminum giant Chalco said it would cut alumina production.
Alumina prices jumped more than 70 yuan/mt in the week ended July 3 to 2,333 yuan/mt, according to SMM assessments. The prices were little changed in the prior week, and climbed 14 yuna/mt the week before.
Chalco (Aluminum Corp of China Ltd.) said Thursday it would implement “flexible production,” which refers to output cuts, at three alumina production lines in northern China’s Shanxi province in accordance with market conditions.
The three lines, at subsidiaires Shanxi Huaxing and Shanxi New Material, have combined production capacity of about 1.8 million mt per year of alumina, according to the statement by Chalco.
Profit recovery at downstream is spreading to the alumina industry, which is the major driver of the recent rally in alumina prices, SMM believes, and the news of production cuts fuelled the rally.