The price of prebaked anode surged, and the cost of aluminum increased slightly by 0.6% MoM in March.

According to SMM data, the average tax-inclusive full cost of China's aluminum industry in March 2025 was 17,010 yuan/mt, up 0.6% MoM and 3.3% YoY, mainly due to a significant increase in prebaked anode prices during the period. SMM learned that a large aluminum plant in Shandong raised its prebaked anode tender price by 956 yuan/mt MoM in March 2025, with the cash price executed at 5,066 yuan/mt and the acceptance price at 5,093 yuan/mt. The average spot price of SMM A00 in March 2025 was approximately 20,721 yuan/mt (February 26 to March 25), and the average profit of the domestic aluminum industry was about 3,710 yuan/mt.

By the end of March 2025, the operating capacity of domestic aluminum reached 43.85 million mt, and the industry's highest full cost dropped to 20,089 yuan/mt. If the industry calculates based on the monthly average price, 100% of the domestic aluminum operating capacity was profitable in March.

From the perspective of the cost distribution range of aluminum capacity:

The full cost distribution range of aluminum remained stable overall in March. In February 2025, the minimum full cost of aluminum was approximately 13,725 yuan/mt, and the maximum full cost was approximately 20,125 yuan/mt. In March, the minimum full cost of aluminum was approximately 13,865 yuan/mt, and the maximum full cost was approximately 20,089 yuan/mt. The capacity distribution is as follows:

In March, the capacity with a full cost below 15,000 yuan/mt accounted for 1.5% of the total;

The capacity with a full cost in the range of 15,001-16,000 yuan/mt accounted for 25.0%;

The capacity with a full cost in the range of 16,001-17,000 yuan/mt accounted for 20.8%;

The capacity with a full cost in the range of 17,001-18,000 yuan/mt accounted for 33.9%;

The capacity with a full cost in the range of 18,001-19,000 yuan/mt accounted for 13.9%;

The capacity with a full cost exceeding 19,001 yuan/mt accounted for 4.9%.

From the cost breakdown side:

For the alumina raw material, according to SMM data, the average SMM alumina index price in March was 3,306.2 yuan/mt (February 26 to March 25). The weighted average cost of alumina in the national aluminum industry decreased by 4.9% MoM, accounting for 39% of the aluminum production cost. By month-end, both domestic and overseas spot alumina transaction prices showed a downward trend, and prices may fluctuate downward in the short term. With the gradual commissioning of new alumina capacity and no new aluminum capacity being put into operation, spot alumina prices are expected to remain under pressure in the medium and long term. Currently, spot alumina transaction prices in various regions have successively fallen below the 3,000 yuan/mt threshold, and the alumina cost for aluminum production is expected to significantly pull back in April.

For auxiliary materials, the procurement price of prebaked anode surged in March, mainly due to the continued cost support from its raw material, petroleum coke. Affected by the significant drop in aluminum hydroxide prices and the poor purchasing enthusiasm of downstream enterprises, aluminum fluoride prices pulled back. Overall, the increase in auxiliary material costs drove up the aluminum production cost. Entering April, prebaked anode prices continued to rise, and the aluminum fluoride market is expected to see price increases due to supply reduction and rising raw material prices. Overall, the rise in auxiliary material prices is expected to continue driving up the aluminum production cost in April.

Regarding electricity prices, overall electricity prices remained stable in March, with some regions experiencing an increase in comprehensive electricity prices due to adjustments in green electricity prices. The national average electricity price rebounded slightly in March, accounting for 33% of the aluminum production cost. Entering April, electricity prices may drop slightly due to the decline in coal prices, and the electricity cost for aluminum production may decrease slightly.

In April 2025, the monthly average price of alumina may significantly decrease, auxiliary material costs may slightly increase, and power costs may experience a minor pullback. Overall, aluminum costs are expected to show a pullback trend. SMM predicts that the average tax-inclusive full cost for the domestic aluminum industry in April 2025 will be around 16,200-16,600 yuan/mt.