Chalco Raises Alumina Price for Third Time This Year

BEIJING, Aug. 3 -- Aluminum Corp. of China Ltd., the country's largest maker of the light metal, raised the spot price of alumina for a third time this year as demand recovered.

    The price was increased 4.3 percent to 2,400 yuan ($351) a metric ton from July 31, the first gain since April 1, according to a table on the Web site of the Beijing-based company known as Chalco.

    Aluminum futures in Shanghai have jumped 19 percent since April 1, prompting smelters to restart idled capacity and boosting demand for alumina, a raw material. China's 4 trillion yuan stimulus spending is boosting usage of the metal in automobiles and real estate.

    "Chinese aluminum smelters are accelerating the pace of restarts because they are no longer in the red and are making really good profits at the current price," said Wan Ling, Beijing-based analyst at CRU International Co.

    Chalco rose 3.4 percent to 20.31 yuan at 2:34 p.m. in Shanghai trading. In Hong Kong, the stock gained 6.2 percent to HK$9.58. The most actively traded aluminum contract fell 0.9 percent to 15,015 yuan a ton at 2:36 p.m. on the Shanghai Futures Exchange.

    China's official Purchasing Managers' Index rose to a seasonally-adjusted 53.3 in July from 53.2 in June, the Federation of Logistics and Purchasing said in a statement over the weekend. A reading above 50 indicates an expansion.

    Chinese aluminum smelters, the largest in the world, have restarted more than 2 million tons of smelting capacity and a further 4 million tons may still be idle, Wang Feihong, analyst at a unit of China Minmetals Corp., the country's biggest metals trading company, said July 2.

    (Source: Bloomberg)