Overseas Alumina Transactions Decline While Domestic Spot Prices Remain Largely Stable [SMM Alumina Morning Comment]

SMM Morning Comment on Alumina, March 4

In the overnight session, the most-traded alumina 2505 futures contract opened at 3,348 yuan/mt, reached a high of 3,380 yuan/mt and a low of 3,348 yuan/mt, and finally closed at 3,370 yuan/mt, up 0.66%. Open interest stood at 168,000 lots, down 5,797 lots. Regarding spot alumina prices, on March 3, SMM alumina was quoted at 3,381 yuan/mt, flat compared to the previous trading day.

Ore Market: As of March 3, the SMM Imported Bauxite Index was reported at $95.11/mt, down $1.15/mt from the previous trading day. The SMM Guinea Bauxite CIF average price was $93/mt, down $2/mt from the previous trading day, while the SMM Australian Bauxite CIF average price was $91/mt, down $4/mt from the previous trading day.

Industry Updates:

1. In Shanxi Province, the mainstream alumina refineries' caustic soda procurement price in March increased by 500 yuan/mt compared to January-February. The delivery-to-factory price for 50% ion membrane liquid caustic soda was approximately 3,380-3,480 yuan/mt (converted to 100% concentration), with slight price variations due to different transportation distances in some regions.

2. On February 28, 30,000 mt of alumina was transacted overseas at a price of $480/mt FOB Brazil, with shipment scheduled for early April.

Spot-Futures Price Spread Daily Report: According to SMM data, on March 3, the SMM Alumina Index showed a premium of 30 yuan/mt against the most-traded contract's latest transaction price at 11:30.

Warehouse Warrant Daily Report: On March 3, the total registered warehouse warrants for alumina decreased by 17,448 mt compared to the previous trading day, standing at 125,500 mt. In Shandong, the total registered warehouse warrants remained unchanged at 4,513 mt. In Henan, the total registered warehouse warrants decreased by 300 mt to 18,600 mt. In Guangxi, the total registered warehouse warrants decreased by 20,147 mt to 0 mt. In Gansu, the total registered warehouse warrants remained unchanged at 6,616 mt. In Xinjiang, the total registered warehouse warrants increased by 2,999 mt to 9.58 mt.

Overseas Market: As of March 3, the FOB Western Australia alumina price was $472/mt, with ocean freight rates at $19.75/mt. The USD/CNY exchange rate selling price was around 7.31. This price translates to an external selling price of approximately 4,141 yuan/mt at major domestic ports, which is 760 yuan/mt higher than domestic alumina prices. The alumina import window remains closed.

Summary: Recently, domestic spot alumina prices have stabilized, mainly due to increased demand for alumina exports and delivery warehouse transfers, which have supported alumina prices. In the short term, spot alumina prices in some regions have rebounded slightly. However, overseas alumina prices have declined, and the export window is essentially closed. Delivery warehouse transfers cannot provide sustained demand, and the market expects some new alumina capacity to be gradually commissioned. In the medium and long term, spot alumina prices will remain under pressure. In the short term, spot alumina prices may enter a phase of fluctuation and adjustment. Continuous attention should be paid to the profitability of alumina exports and changes in bauxite prices.

[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.]