This Week's Spot Alumina Transaction Prices Continued to Decline, While the Domestic Alumina Export Window May Gradually Open [SMM Alumina Weekly Review]

Published: Feb 13, 2025 16:42

Save

[SMM Weekly Alumina Review: Spot Alumina Transaction Prices Continued to Decline This Week, Domestic Alumina Export Window May Gradually Open] 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 refineries dropped by 0.33 percentage points this week. Demand side, some aluminum production capacity in Sichuan and other regions, which had been undergoing technological transformation due to production cuts, has gradually resumed operations, leading to an increase in alumina demand. Cost side, the sharp decline in spot alumina prices significantly reduced alumina refineries' acceptance of high-priced bauxite. Consequently, bauxite holders lowered their quotations, and imported bauxite prices also fell. Alumina production costs may decline accordingly. However, current spot alumina transaction prices in northern regions remain below the theoretical marginal production cost. Overall, large-scale alumina production cuts have not yet occurred, and the spot alumina market remains relatively well-supplied. Spot transaction prices continued their downward trend and are likely to extend this trend in the short term.

SMM February 13 News:

Price Review:

As of this Thursday, the SMM regional weighted index was 3,391 yuan/mt, down 411 yuan/mt WoW. Among them, Shan Dong reported 3,250-3,350 yuan/mt, down 425 yuan/mt WoW; Henan reported 3,350-3,450 yuan/mt, down 375 yuan/mt WoW; Shanxi reported 3,250-3,450 yuan/mt, down 350 yuan/mt WoW; Guangxi reported 3,400-3,500 yuan/mt, down 550 yuan/mt WoW; Guizhou reported 3,450-3,600 yuan/mt, down 515 yuan/mt WoW; Bayuquan reported 4,610-4,690 yuan/mt.

Overseas Market:

As of February 13, 2025, FOB Western Australia alumina prices were $538/mt, ocean freight rate was $19.70/mt, and the US dollar/yuan exchange rate selling price was around 7.31. This price translates to an ex-factory selling price of approximately 4,688 yuan/mt at major domestic ports, 1,247 yuan/mt higher than domestic alumina prices, keeping the alumina import window closed. This week, one new overseas alumina spot transaction was recorded: on February 11, 30,000 mt of alumina was transacted at $538/mt FOB Western Australia or $534/mt FOB Eastern Australia, with shipment scheduled for late March.

Domestic spot alumina prices continued to plummet, with the lowest spot transaction prices in northern China this week reaching around 3,200-3,300 yuan/mt. Considering freight and port miscellaneous fees, this translates to an FOB price of approximately $460-490/mt, lower than Australian alumina FOB prices, potentially gradually opening the export window.

Domestic Market:

According to SMM data, as of this Thursday, the national weekly operating rate of alumina decreased by 0.36 percentage points WoW to 86.94%. Among them, the weekly operating rate of alumina in Shandong remained flat WoW at 92.66%; in Shanxi, it decreased by 1.03 percentage points WoW to 79.57%; in Henan, it decreased by 0.71 percentage points WoW to 68.45%; and in Guangxi, it remained flat at 93.94%. During the period, aluminum smelters were relatively active in tendering and purchasing alumina, and spot transaction prices continued to decline. This week, spot transaction ex-factory prices for alumina in Henan were 3,320-3,550 yuan/mt; in Guizhou, 3,420-3,700 yuan/mt; in Guangxi, delivery-to-factory prices in Yunnan were 3,460 yuan/mt. Additionally, aluminum smelters in Xinjiang tendered for some spot alumina, with delivery-to-factory prices around 3,600-3,800 yuan/mt, while aluminum smelters in north-west China tendered for some spot alumina, with delivery-to-factory prices at 3,425-3,525 yuan/mt.

Overall:

Supply side, some alumina refineries in northern China reported maintenance this week, which may slightly impact alumina supply in the short term, with the weekly operating rate of alumina slightly decreasing by 0.33 percentage points. Demand side, some aluminum production capacity in Sichuan and other regions undergoing technological transformation or production cuts may gradually resume production, increasing demand for alumina. Cost side, due to the sharp decline in spot alumina prices, alumina refineries have significantly reduced their acceptance of high-priced bauxite, leading to a decline in bauxite quotations from holders and a drop in imported bauxite prices. Alumina production costs may decrease accordingly, but current spot alumina transaction prices in northern China are below the theoretical marginal cost of production. Overall, large-scale alumina production cuts have not yet occurred, and the spot alumina market remains relatively ample in supply. Spot transaction prices continue to decline and may maintain a downward trend in the short term.

Source: SMM

》Click to View the SMM Aluminum Industry Chain Database

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM‘s internal database model. They are for reference only and do not constitute decision-making recommendations.

For any inquiries or to learn more information, please contact: lemonzhao@smm.cn

For more information on how to access our research reports, please contact:service.en@smm.cn

Related News

23 hours ago

Fed Governor Milan Pushes for Over 100 Basis Points Cut, Contradicts Barkin on Caution

Federal Reserve Governor Milan pointed out that it is necessary for the US Fed to cut interest rates by more than 100 basis points this year. At the same time, he is very much looking forward to the performance of Kevin Warsh as Fed Chairman. However, Richmond Fed President Barkin emphasized that monetary policy must remain cautious until inflation fully pulls back to the target level, thereby ensuring the stability of the labour market.

23 hours ago

Democratic Senators Demand Delay in Fed Nomination Amid Criminal Investigation

All 11 Democratic members of the US Senate Banking Committee jointly sent a letter to the committee's chairman, Tim Scott, requesting that all nomination processes for the prospective Fed Chairman, Kevin Warsh, be postponed until the criminal investigation into current Fed Chairman Powell and other board members is concluded. However, Scott stated that Warsh's confirmation was a done deal.

23 hours ago

Fed to Keep Large Banks' Capital Levels Unchanged, Postpones Stress Test Reforms Until 2027

The US Fed has announced that it will maintain the capital levels of large banks unchanged during the upcoming stress test cycle (corresponding to the 2026 cycle). At the same time, the US Fed is planning multidimensional reforms to this annual test, aiming to enhance its transparency. The US Fed's Vice Chair for Supervision, Bowman, revealed that adjustments to the stress capital buffer requirements for large banks will be postponed until 2027. This move is intended to provide the US Fed with sufficient time to evaluate potential flaws that may be exposed in its testing models when assessing banks' financial conditions under simulated economic downturn scenarios.

23 hours ago