SMM July 2 News:
In June, the weighted average cost of alumina nationwide was approximately 2,971 yuan/mt, basically flat MoM.
Cost breakdown:
For bauxite, the price of Guinean bauxite was boosted by the ore rights revocation incident, with the average price rebounding slightly; the price of Australian bauxite dropped back slightly, while the long-term contract prices of imported bauxite remained stable. The price of domestic bauxite was relatively stable. Overall, the bauxite cost for alumina production decreased slightly MoM. Entering July, there has been no significant adjustment in the price of domestic bauxite so far. It is expected that the long-term contract prices of imported bauxite in Q3 will remain stable or decrease slightly, with sluggish spot transactions of imported bauxite and stable price movements. Overall, the bauxite cost for alumina production in July is expected to decrease slightly.
For caustic soda, the prices of caustic soda in Shanxi and Guangxi regions rebounded slightly in June, leading to a slight increase in the caustic soda cost for alumina production. Entering July, as of now, the long-term contract price of caustic soda in Henan region has decreased by approximately 140 yuan/mt; the long-term contract price of caustic soda in Guangxi region has decreased by approximately 150 yuan/mt; the current price of caustic soda in Shandong region is at a lower level compared to June, and the average price in July is expected to fall MoM. Overall, the caustic soda cost for alumina production in July is expected to decrease.
Overall, the weighted average cost of alumina nationwide in July is expected to drop back slightly, operating at around 2,850-3,050 yuan/mt.
