Multiple Factors Weigh on July Alumina Operating Capacity YoY, Recovery Expected to Strengthen in August

SMM July 31 –

In July 2026, China's metallurgical-grade alumina output rose 2.18% month-on-month, but declined 2.48% year-on-year. As of the end of July, the country's total built capacity stood at approximately 118.42 million tonnes/year, while overall operating capacity fell 1.18% month-on-month and 2.48% year-on-year.

The month-on-month decline in operating capacity was primarily driven by the combined impact of multiple regional factors, leading to diverging utilization rates among producers:

In southern China, some Guangxi-based smelters gradually resumed operations in July after earlier boiler-related shutdowns, with capacity recovering to around 3 million tonnes/year by the end of the month, providing some support to regional output. However, another Guangxi alumina refinery proactively reduced production due to technical issues, partially offsetting the recovery momentum. In Guizhou, tight domestic bauxite supply prompted smelters to adjust production schedules flexibly, while routine maintenance work further curtailed output. Nevertheless, one Guizhou smelter that had previously suspended operations is steadily ramping up production, contributing to a modest increase in the province's total output.

In northern China, a Shanxi-based smelter remained offline throughout July due to red mud disposal issues, becoming a key drag on regional production. Meanwhile, multiple northern smelters faced tightening bauxite supply, which further constrained operating rates and weighed on overall output in the region.

Looking ahead to August, China's metallurgical-grade alumina output is expected to recover. In Guangxi, maintenance work and boiler issues are likely to be largely resolved, allowing production to return to normal levels. The red mud disposal problem in Shanxi is also expected to be addressed by mid-August, enabling the restart of affected capacity. In addition, domestic bauxite supply is anticipated to improve modestly, providing feedstock support for output growth. Although some regions have planned maintenance schedules, the overall volume of restarts is expected to outweigh maintenance-related reductions. Preliminary estimates suggest that China's metallurgical-grade alumina operating capacity will stabilize at around 89.20 million tonnes/year in August.