Alumina Profit Margins Narrow Significantly, Bauxite Prices Face Pressure at the Top [SMM Bauxite Weekly Review]

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SMM January 23 News:

Domestic Bauxite:

This week, the domestic bauxite market saw no significant changes, with prices fluctuating at highs. However, domestic spot alumina prices dropped sharply, significantly narrowing alumina profit margins. Buyers of domestic bauxite in north China showed a slight desire to bargain down prices, but the supply and demand fundamentals for domestic bauxite in the region remained tight. Currently, no significant price declines for domestic bauxite have been observed, and SMM will continue to monitor the situation.

As of today, the transaction prices for bauxite with an Al/Si ratio of 5.0 and alumina content of 60% (excluding VAT, self pick-up at crushing plants) were approximately 640-680 yuan/mt in Shanxi, 580-620 yuan/mt in Henan, 510-550 yuan/mt in Guizhou (Al/Si ratio 5.5, alumina content 58%), and 320-335 yuan/mt in Guangxi (Al/Si ratio 6.0, alumina content 53%).

Imported Bauxite:

According to data from January 17, the weekly port arrivals of bauxite at domestic ports totaled 2.69 million mt, down 1.54 million mt from the previous week. Weekly port departures of bauxite from Guinea's main ports totaled 3.88 million mt, up 1.55 million mt from the previous week, while weekly port departures from Australia's main ports totaled 900,000 mt, up 40,000 mt from the previous week.

In December 2024, China's bauxite imports returned to high levels, with total imports reaching 14.98 million mt, up 21.9% MoM. This was mainly due to the end of the rainy season in Guinea, while non-mainstream bauxite imports for the month reached 1.2 million mt, marking a five-year high. Moving forward, the impact of the rainy season in Australia is expected to reduce China's bauxite imports from Australia, but increased shipments from Guinea are anticipated. China's total bauxite imports are expected to remain stable with a slight increase.

SMM Comments: Recently, no new transaction prices for imported bauxite from Guinea have been observed, as buyers and sellers remain in negotiation. However, both supplier quotes and buyer target prices for bauxite have shown a downward trend, and prices for imported bauxite from Guinea are expected to pull back to some extent. The supply fundamentals for domestic bauxite remain tight, providing some price support. However, the sharp decline in alumina transaction prices has stimulated some domestic ore buyers' desire to bargain down prices. In the short term, domestic ore prices may fluctuate, and further developments will require close monitoring.

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