The YoY Increase in Imported Bauxite Is Significant, Alumina Center Shifts Downward Again [SMM Alumina Morning Comment]

SMM Alumina Morning Comment 3.19

Futures Market: During the night session, the most-traded alumina 2505 futures contract opened at 3,081 yuan/mt, reached a high of 3,082 yuan/mt, a low of 3,054 yuan/mt, and closed at 3,060 yuan/mt, down 0.68%. Open interest stood at 224,000 lots, up 5,246 lots. Spot Alumina Prices: On March 18, SMM alumina was quoted at 3,254 yuan/mt, down 24 yuan/mt from the previous trading day.

Bauxite: As of March 18, the SMM imported bauxite index was reported at $93.39/mt, flat from the previous trading day. The SMM Guinea bauxite CIF average price was $91/mt, unchanged from the previous trading day, while the SMM Australia bauxite CIF average price was $87/mt, also unchanged.

Industry News:

1. Jamalco plans to invest $70.5 million to expand bauxite resources in the Manchester area to extend the mine's operational life. The project will be implemented from 2025 to 2027, aiming to stabilize alumina supply. Currently, 90% of Jamalco's bauxite comes from the SML 130 mining area, but resources are nearing depletion. The company plans to shift to SML 169. However, this area involves both government and private land, making land ownership a key challenge. Jamalco needs to negotiate mining rights with relevant parties while addressing community and environmental issues to ensure smooth project progress.

2. According to data from the General Administration of Customs, China imported 16.21 million mt of bauxite and its concentrates in January 2025, up 8.2% MoM and 23.3% YoY. In February, imports totaled 14.41 million mt, down 11.1% MoM but up 28.3% YoY. Cumulative imports for January-February reached 30.62 million mt, up 25.6% YoY.

Spot-Futures Price Spread Daily Report: According to SMM data, on March 18, the SMM alumina index showed a premium of 145 yuan/mt against the most-traded contract's latest transaction price at 11:30.

Warrant Daily Report: On March 18, the total registered warrants for alumina increased by 2,424 mt from the previous trading day to 284,400 mt. In Shandong, the total registered warrants remained unchanged at 4,513 mt. In Henan, the total registered warrants were also unchanged at 30,600 mt. In Guangxi, the total registered warrants remained flat at 4.98 mt. In Gansu, the total registered warrants decreased by 1,199 mt to 2.28 mt. In Xinjiang, the total registered warrants increased by 3,623 mt to 1.77 mt.

Overseas Market: As of March 18, the FOB Western Australia alumina price was $425/mt, with ocean freight at $20.55/mt. The USD/CNY exchange rate selling price was around 7.24. This price translates to an external selling price of approximately 3,726 yuan/mt at major domestic ports, 472 yuan/mt higher than domestic alumina prices. The alumina import window remains closed.

Summary: Recently, the tug-of-war between sellers and buyers in the alumina market continues. The spot alumina market has seen sporadic transactions, with transaction prices experiencing further slight declines. The domestic alumina export window remains closed, and the total registered warrants in alumina delivery warehouses have exceeded 280,000 mt. Subsequent alumina exports and warehouse transfers may struggle to provide sustained demand. Fundamentals side, short-term alumina operating capacity is expected to see both increases and decreases, with no significant decline anticipated in total operating capacity. The alumina market is expected to maintain a slight surplus, and spot alumina prices are likely to fluctuate downward in the short term.

[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.]