From January to February, domestic primary aluminum imports rose by 214.7% YoY, and net imports rose by 221.9% YoY.

According to customs data, the total imports of primary aluminium from January to February were 472,000 mt, up 214.7% YoY; the total exports were 985 mt, down 73% YoY; the total net imports were 471,000 mt, up 221.9% YoY; Imports by country and their changes in January: Russia (161,800 mt, +34.4% MoM, + 299.6% YoY); India (38,200 mt, +172.2% MoM, +366.2% YoY); Indonesia (22,100 mt, +103.7% MoM). Russia accounted for 65.3% of China’s total imports, followed by India (15.4%) and Indonesia (8.9%). Imports by country and their changes in February: Russia (115,400 mt, -28.7% MoM, + 78.0% YoY); India (26,500 mt, -30.5% MoM, +6512.2% YoY); China (23,300 mt); Indonesia (22,100 mt). Russia accounted for 78.0% of China’s total imports, followed by India, China (10.4%) and Indonesia (9.9%).

China's main sources of primary aluminum imports from January to February were Russia, India, Indonesia, China, the United Arab Emirates, Malaysia and other countries. Total imports from Russia was about 277,000 mt, accounting for 58.7% of the total, up 163.2% YoY. Imports of primary aluminum from Russia reached 162,000 mt in January, reaching a new high in past two years. Russia accounted for 58.7% of China’s total imports, followed by India (64,000 mt, 13.7%, +607% YoY) and Indonesia (44,000 mt, 9.4%). Total imports from China was 23,300 mt, accounting for 4.95%, which were mainly were under "export processing" trade model, namely imports after being processed overseas. Judging from the data on alumina exported by China under “export processing” trade from October 2023 to February 2024, China's primary aluminum under “export processing” trade model may increase. Overall, China's primary aluminum import window opened for a long time from January to February 2024, especially in January, and import profits were considerable. Primary aluminum from many countries came to China. Therefore, although the total amount of primary aluminum imported from Russia remained at a high level, its proportion decreased. In the future, imported primary aluminum from Russia will remain the main driver.

Domestic primary aluminum imports from January to February 2024 mainly flowed in through general trade, with imports accounting for 66.64% of total; primary aluminum under inbound and outbound goods through bonded supervision sites and logistics goods in special customs supervision areas accounted for 25.04%. Considering that the import window closed at the end of January and opened in late February, some bonded area goods may enter the domestic aluminum market in early March; the rest 4.95% will be imported under “export processing trade”, 2.31% will be imported under feeding processing trade and 1.06% will be under tolling trade.

From January to February, domestic primary aluminum mainly flowed out through logistics goods in special customs supervision areas, accounting for 96.75%. 45.65% of primary aluminum was exported to Angola, and 30.46% to Nigeria.

SMM Brief Comment: From January to February 2024, China's aluminum import window opened for a long time. In January, in particular, the import window opened for about 20 days. Net imports rose by 221.91% YoY in Jan-Feb, with the total amount reaching 471,000 mt. The large amount of imported primary aluminum somehow affected the market and aluminum ingot inventory. China's aluminum social inventory growth slowed down, but has not yet dropped, which may be affected by imported primary aluminum. The amount of imported primary aluminum through processing trade may increase. However, due to the closure of China’s primary aluminum import window and the production resumption by smelters in Yunnan, the total amount of imported primary aluminum in March may decrease slightly from the previous month. Considering long-term orders and other factors, SMM predicts that primary aluminum will maintain a net import in 2024, and the average monthly net import will remain high.