Alumina Price Rise May Face Resistance Amid Supply Recovery [SMM Alumina Morning Comment]

Published: May 27, 2025 09:44

Save

SMM Alumina Morning Comment on May 27

Futures Market: Overnight, the most-traded alumina 2509 futures contract opened at 3,061 yuan/mt, with a high of 3,062 yuan/mt, a low of 2,980 yuan/mt, and closed at 3,001 yuan/mt, down 59 yuan/mt or 1.93%. Open interest stood at 401,000 lots.

Ore Market: As of May 26, the SMM Import Bauxite Index was reported at $73.33/mt, up $0.47/mt from the previous trading day. The SMM Guinea Bauxite CIF average price was reported at $74/mt, unchanged from the previous trading day. The SMM Australia Low-Temperature Bauxite CIF average price was reported at $70/mt, unchanged from the previous trading day. The SMM Australia High-Temperature Bauxite CIF average price was reported at $65/mt, unchanged from the previous trading day.

Industry Updates:

Overseas Alumina Transactions: On May 23, 30,000 mt of alumina was traded overseas at a transaction price of $373/mt FOB Indonesia, with a shipment schedule for late July.

Basis Report: According to SMM data, on May 23, the SMM Alumina Index had a premium of 208.13 yuan/mt against the latest transaction price of the most-traded contract at 11:30.

Warrant Report: On May 26, the total registered alumina warrants decreased by 6,599 mt from the previous trading day to 150,400 mt. In Shandong, the total registered alumina warrants remained unchanged at 601 mt from the previous trading day. In Henan, the total registered alumina warrants remained unchanged at 3,001 mt from the previous trading day. In Guangxi, the total registered alumina warrants decreased by 900 mt from the previous trading day to 6,304 mt. In Gansu, the total registered alumina warrants remained unchanged at 6,306 mt from the previous trading day. In Xinjiang, the total registered alumina warrants decreased by 5,699 mt from the previous trading day to 134,200 mt.

Overseas Market: As of May 26, 2025, the FOB Western Australia alumina price was $370/mt, with an ocean freight rate of $21.40/mt. The USD/CNY selling rate was around 7.19. This price translates to approximately 3,261 yuan/mt for the external selling price at major domestic ports, which is 5.76 yuan/mt higher than the domestic alumina price. The alumina import window remained closed.

Summary: Last week, some enterprises in north China underwent maintenance, while some alumina refineries in south China completed maintenance, leading to a rebound in operating capacity. Overall, the national alumina operating capacity increased by 1.09 million mt MoM last week. In the near future, some new alumina enterprises are expected to undergo maintenance, while some enterprises are expected to complete maintenance and resume operating capacity. Overall, the operating capacity is expected to continue to rebound slightly. Affected by supply-side disruptions in the bauxite market, bauxite prices have risen, and the cost support for alumina is expected to strengthen. Coupled with the fact that the short-term fundamentals have not shifted to a surplus pattern, there is still upward momentum in prices. However, with the recovery of supply, alumina prices may encounter resistance to further increases. In the short term, spot alumina prices are expected to hold up well.

[The information provided is for reference only. This article does not constitute direct advice for investment research and decision-making. Clients should make decisions cautiously and should not replace their own independent judgment with this information. Any decisions made by clients are not related to SMM.]

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM's internal database model. They are for reference only and do not constitute decision-making recommendations.

For any inquiries or for more information, please contact: lemonzhao@smm.cn

For more information on how to access our research reports, please contact:service.en@smm.cn

Related News

33 mins ago

SHFE Aluminum Futures See Slight Correction, Weak Demand Suppresses Market Transactions

After the opening, SHFE aluminum futures experienced a slight correction. Although traders in the central China market had the intention to hold prices firm, weak purchase willingness from downstream processing enterprises suppressed overall market transactions. Only hedging traders were willing to purchase in large quantities when premiums were less negative, aiming to widen price spreads for profit. Market offers edged up but remained at relatively low levels. Ultimately, the actual transaction price range in the central China market was around a premium of -170 to -190 yuan/mt against the SHFE aluminum August contract.

33 mins ago

52 mins ago

PBOC Releases Easing Signals, Aluminum Price Upside Room Limited Amid Supply-Demand and Geopolitical Game [SMM Aluminum Morning Meeting Minutes]

[Central Bank Sends Easing Signals; Supply-Demand and Geopolitical Games Limit Aluminum Price Upside Room] Our comprehensive assessment shows that the macro front has improved recently, with the marginal constraints of interest rate hike expectations on the nonferrous metals sector continuing to ease. The proportion of liquid aluminum in China has kept rising. China’s central bank will implement accommodative monetary policies, step up counter-cyclical adjustments, and redouble efforts to expand domestic demand to steer the economy toward sustained, more favorable, and broader-based development. The persistent geopolitical risk premium in the Middle East has jointly underpinned aluminum prices, significantly boosting short-term market confidence. However, the ongoing commissioning of long-term aluminum capacity outside China, the recent softness in traditional end-use demand in China, combined with the repeated shifts in expectations for US Fed interest rate hikes and the uncertainties triggered by geopolitical turmoil in the Middle East, continue to exert certain pressure on the upside room for aluminum prices.

52 mins ago

1 hour ago

China's Secondary Aluminum Ingot Inventory Down 198 MT, Foshan Sees Largest Decline

[SMM Aluminum Express] The daily inventory of secondary aluminum ingot in major consumption regions in China was 7,619 mt today, a decline of 198 mt from the previous trading day. Among them, destocking in Foshan region was 217 mt, while inventory buildup in Ningbo region reached 18 mt.

1 hour ago