Alumina Transaction Prices Rebound Slightly, Overseas Alumina Prices Decline Further [SMM Morning Comment on Alumina]

SMM Morning Comment on Alumina for February 24

Futures Market: During the night session, the most-traded alumina 2505 futures contract opened at 3,410 yuan/mt, reached a high of 3,426 yuan/mt, a low of 3,354 yuan/mt, and closed at 3,364 yuan/mt, down by 73 yuan/mt or 2.12%. Open interest stood at 177,000 lots.

Spot Alumina: Last Friday, 10,000 mt of alumina was traded in Henan at a transaction price of 3,400 yuan/mt; 3,000 mt was traded in Shandong at 3,415 yuan/mt; and 2,000 mt was traded in Guangxi at 3,400 yuan/mt.

Ore: As of February 21, the SMM imported bauxite index stood at $96.42/mt, unchanged from the previous trading day. The SMM Guinea bauxite CIF average price was $95/mt, also unchanged, while the SMM Australian bauxite CIF average price remained at $95/mt. According to data from February 21, the weekly port arrivals of bauxite at domestic ports totaled 3.212 million mt, down by 694,100 mt from the previous week. Weekly port departures of bauxite from Guinea's main ports totaled 3.462 million mt, down by 162,800 mt, while those from Australia's main ports totaled 553,700 mt, up by 83,700 mt.

Industry Dynamics:

1. According to SMM statistics on February 21, bauxite inventory at nine domestic ports totaled 14.29 million mt, down by 30,000 mt from the previous week.
2. According to SMM statistics on February 21, alumina inventory at domestic ports totaled 15,000 mt, up by 15,000 mt from the previous week.
3. Overseas Alumina Transactions: On February 20, 30,000 mt of alumina was traded at a transaction price of $485/mt FOB Bunbury, Western Australia, for April shipment.

Spot-Futures Price Spread Daily Report: According to SMM data, on February 21, the SMM alumina index showed a discount of 96 yuan/mt against the most-traded contract's latest transaction price at 11:30.

Warehouse Warrant Daily Report: On February 21, the total registered warehouse warrants for alumina remained unchanged from the previous trading day at 94,000 mt. In Shandong, the total registered warehouse warrants for alumina remained unchanged at 4,513 mt; in Henan, they remained unchanged at 18,000 mt; in Guangxi and Gansu, they remained at 0 mt; and in Xinjiang, they remained unchanged at 71,400 mt.

Overseas Market: As of February 21, the FOB Western Australia alumina price was $485/mt, with an ocean freight rate of $19.85/mt. The USD/CNY exchange rate sell price was around 7.27. This price translates to an external selling price of approximately 4,225 yuan/mt at major domestic ports, which is 880 yuan/mt higher than domestic alumina prices. The alumina import window remains closed.

Summary: Recently, there have been reports of minor production cuts and maintenance in northern regions, coupled with concentrated news of domestic alumina exports, which have supported alumina prices and improved market sentiment. This week, spot alumina prices have stabilized after declining. However, operating capacity for alumina remains high, and the incremental demand for aluminum is limited. The fundamental market structure has not yet fully shifted, and resistance at the top of alumina prices persists. In the short term, alumina prices may enter a phase of fluctuation and adjustment. Continuous attention should be paid to the alumina export window and changes in operating capacity.

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