SMM Alumina Morning Comment on May 9
Futures Market: Overnight, the most-traded alumina 2509 futures contract opened at 2,800 yuan/mt, with a high of 2,857 yuan/mt, a low of 2,780 yuan/mt, and closed at 2,854 yuan/mt, up 99 yuan/mt or 3.58% from the previous close, with open interest at 282,000 lots.
Ore: As of May 8, the SMM Import Bauxite Index was reported at $77.98/mt, down $0.26/mt from the previous trading day. The SMM Guinea Bauxite CIF average price was reported at $76/mt, down $1/mt from the previous trading day. The SMM Australia Low-Temperature Bauxite CIF average price was reported at $80/mt, unchanged from the previous trading day. The SMM Australia High-Temperature Bauxite CIF average price was reported at $72/mt, unchanged from the previous trading day.
Alumina Spot: In Shandong, 5,000 mt of alumina was traded at 2,880 yuan/mt. In Henan, 2,000 mt of alumina was traded at 2,940 yuan/mt. In Guizhou, 5,000 mt of alumina was traded at 3,000 yuan/mt.
Industry News:
- Alumina Port Inventory: According to SMM statistics on May 8, the total alumina inventory at domestic ports was 37,000 mt, an increase of 18,000 mt from the previous week.
- Weekly Alumina Production Dynamics: According to SMM data, as of Thursday this week, the total installed capacity of metallurgical-grade alumina in China was 109.22 million mt/year, with a total operating capacity of 87.02 million mt/year. The national weekly alumina operating rate decreased by 0.07 percentage points WoW to 79.67%. Alumina refineries experienced varying changes in operating capacity, with maintenance-related production cuts and production resumptions coexisting. The total national operating capacity decreased by 80,000 mt/year WoW.
- Guinea Plans to Revoke EGA's Mining License. Reuters reported on May 7, 2025, that sources revealed the Guinean government had initiated procedures to revoke the mining license of Emirates Global Aluminium (EGA) in the country. EGA operates one of the largest bauxite mines in Guinea through its subsidiary, Guinea Alumina Corporation (GAC). Since October 2024, GAC's export and mining activities have been suspended by the government. EGA has been operating in Guinea since 2019 and exported approximately 14 million mt of bauxite in 2022. Affected by the suspension, its exports fell to 10.8 million mt in 2024. The mining area covers 690 square kilometers, with estimated reserves of approximately 400 million mt of bauxite. Guinea's move reflects the growing trend of resource-rich countries in the region strengthening their control over minerals, particularly as military regimes in Guinea, Mali, Niger, and Burkina Faso push for revisions to mining laws, seizures of mineral assets, and increased state revenue shares.
Spot-Futures Price Spread Daily Report: According to SMM data, on May 8, the SMM Alumina Index had a premium of 126 yuan/mt against the latest transaction price of the most-traded contract at 11:30.
Warrant Daily Report: On May 8, the total registered volume of alumina warrants decreased by 9,895 mt from the previous trading day to 249,800 mt. In Shandong, the total registered volume of alumina warrants remained unchanged from the previous trading day at 601 mt. In Henan, the total registered volume of alumina warrants remained unchanged from the previous trading day at 3,001 mt. In Guangxi, the total registered volume of alumina warrants decreased by 5,104 mt from the previous trading day to 22,800 mt. In Gansu, the total registered volume of alumina warrants remained unchanged from the previous trading day at 16,800 mt. In Xinjiang, the total registered volume of alumina warrants decreased by 4,791 mt from the previous trading day to 206,600 mt.
Overseas Market: As of May 8, 2025, the FOB Western Australia alumina price was $348/mt, with an ocean freight rate of $20.50/mt. The selling price of the USD/CNY exchange rate was around 7.26. This price translates to approximately 3,102 yuan/mt for the external selling price at major domestic ports, which is 206 yuan/mt higher than the domestic alumina price. The alumina import window remained closed.
Summary: This week, alumina enterprises experienced both increases and decreases in operating capacity, with the total operating capacity slightly decreasing by 80,000 mt/year. It is expected that some alumina enterprises will conduct maintenance in the following period, while new alumina capacity is anticipated to continue commissioning and ramp up production. In the short term, the operating capacity of alumina may fluctuate. Recently, downstream feedback indicates that spot cargo availability is tight in some regions. With suppliers standing firm on quotes, spot prices may rebound slightly. However, on the cost side, bauxite prices have fallen significantly compared to the previous period, weakening the cost support. Overall, the alumina market is influenced by a mix of bullish and bearish factors, and prices are expected to fluctuate in the short term.
[The information provided is for reference only. This article does not constitute direct advice for investment research decisions. Clients should make cautious decisions and should not rely on this information to replace their own independent judgment. Any decisions made by clients are not related to SMM.]
