Currently, the alumina futures market is trading cautiously, with ample spot cargo supply and prices under pressure [SMM Alumina Morning Comment]

SMM Alumina Morning Comment Jan. 23

Futures:The most-traded alumina a2605 futures contract opened at 2,717 yuan/mt in the night session, hit a high of 2,741 yuan/mt, touched a low of 2,708 yuan/mt, and finally closed at 2,729 yuan/mt, up 12 yuan/mt from the previous day. Open interest increased by 7,281 lots to 496,000 lots, indicating cautious market sentiment. Technically, the closing price above the MA5 (2,704.4) provided some upward momentum, but remained below the MA10 (2,750.80) and MA30 (2,739.23), suggesting continued resistance near the short-term structural top. Meanwhile, the MACD indicator's "death cross" persisted, with the DEA (-5.74) crossing above the DIF (-15.40), signaling increased downward momentum, and the histogram reading was -19.32. Alumina futures are expected to remain in the doldrums in the near term.

Industry Developments:

1) SMM data showed that, as of Thursday this week, bauxite inventory at alumina refineries decreased by 94,400 mt WoW.

2) According to SMM data, as of Thursday this week, China's total metallurgical-grade alumina capacity reached 110.32 million mt/year, with operating capacity at 87.12 million mt/year. The national alumina operating rate fell 1.85 percentage points WoW to 79.97%, as domestic alumina refineries continued to operate at high levels.

3) Overseas news reported that on the local time of January 21, 2026, a collapse occurred at a mechanized mine in the Doké mining area, Siguiri Province, Guinea, resulting in the deaths of 6 miners. The accident happened at the border between the Sala and Bembéta districts, where the mine pit wall suddenly collapsed, preventing timely evacuation of personnel on site. The cause is still under investigation. According to SMM, Guinea's mineral distribution is clearly defined, with "bauxite in the west and gold in the east." Specifically: Bauxite Belt: Concentrated in the western coastal regions of Boké, Kindia, and Fria. This is the core production area for the Winning Consortium (SMB), Alcoa (CBG), and Rusal. Gold Belt: Siguiri is located in northeastern Guinea (Upper Guinea region), approximately 800 km from the core bauxite mining area of Boké. This gold mine accident has not yet affected production in Guinea's core bauxite mining areas.

Ore Side:As of January 22, 2026, the SMM imported bauxite index was $65.85/mt, flat from the previous day. The SMM Guinea FOB average was $41/mt, flat from the previous day. The SMM Guinea bauxite CIF average was $64/mt, flat from the previous day. The SMM Australia low-temperature bauxite CIF average was $64/mt, flat from the previous day. The SMM Australia high-temperature bauxite CIF average was $58/mt, down $1/mt from the previous day. The SMM Malaysia bauxite CIF average was $47/mt, flat from the previous day. The SMM Malaysia bauxite CIF (washed) average was $62.5/mt, flat from the previous day. The SMM Ghana bauxite CIF price was $75/mt, flat from the previous day. The SMM bauxite CFR (Turkey) price was $75/mt, flat from last Friday.

Spot prices: As of January 22, 2025, the SMM alumina index was reported at 2,632.78 yuan/mt, down 1.16 yuan/mt MoM; the SMM Shandong alumina index was reported at 2,557.14 yuan/mt, down 1.25 yuan/mt MoM; the SMM Henan alumina index was reported at 2,629.72 yuan/mt, down 1.6 yuan/mt MoM; the SMM Shanxi alumina index was reported at 2,615.36 yuan/mt, down 1.46 yuan/mt MoM; the SMM Guizhou alumina index was reported at 2,716.39 yuan/mt, down 1.26 yuan/mt MoM; the SMM Guangxi alumina index was reported at 2,703.16 yuan/mt, down 1.15 yuan/mt MoM.

Spot-futures price spread report: According to SMM data, on January 22, the SMM alumina index was at a discount of 79.22 yuan/mt against the latest transaction price of the most-traded contract at 11:30.

Warrant report: On January 21, the total registered volume of alumina warrants increased by 7,513 mt from the previous trading day to 126,600 mt. The total registered volume of alumina warrants in Shandong remained unchanged from the previous trading day at 7,796 mt, in Henan remained unchanged at 0 mt, in Guangxi remained unchanged at 5,103 mt, in Gansu remained unchanged at 3,607 mt, and in Xinjiang increased by 7,513 mt from the previous trading day to 110,000 mt.

Overseas market: As of January 22, 2026, the FOB Western Australia alumina price was $304/mt, the ocean freight rate was $19.4/mt, and the USD/CNY selling rate was around 6.98. This price translates to a selling price of about 2,630.86 yuan/mt at mainstream domestic ports, slightly lower than the SMM alumina index price by 1.92 yuan/mt. According to SMM model calculations, the import window is open.

Summary: Currently, domestic alumina market inventory saw a slight decrease MoM, but the overall oversupply situation remains unchanged. Due to environmental protection-related controls and operational pressures, some alumina refineries in north China underwent maintenance, leading to a pullback in the industry operating rate and a weekly production decrease of 39,000 mt. Inventory side, in-factory inventory of alumina refineries dropped by 50,000 mt, while raw material inventory at aluminum enterprises edged down by 2,000 mt. Due to previous maintenance leading to a decline in operational rates, alumina refineries are still primarily focused on fulfilling long-term contract orders, necessitating continuous consumption of inventory to ensure downstream supply, which promotes the reduction of plant inventories. Aluminum enterprises made limited spot purchases recently and maintained normal production consumption, resulting in a slight decrease in raw material inventory. Additionally, in-transit and platform inventories—mainly comprising goods destined for Xinjiang futures delivery warehouses and aluminum smelters—increased by approximately 31,000 mt. Overall, although alumina inventories showed a slight destocking this week, reversing the previous trend of continuous inventory buildup, current overall industry inventories remain high. Going forward, attention should be paid to the implementation of maintenance at alumina enterprises and the recovery progress of previous maintenance activities. Alumina inventories are expected to continue a slight destocking trend next week.

[Except for publicly available information, other data are processed by SMM based on public information, market communication, and SMM's internal database model, and are for reference only, not constituting decision-making advice.]