Alumina Price Drop To Spill Over From Low-Cost Regions To High-Cost Areas Amid Growing Supply

SHANGHAI, Apr 17 (SMM) - A large aluminium smelter in Gansu province purchased 35,000 mt of alumina from Shanxi province at 2,900 yuan/mt, which was 30 yuan/mt lower than the previous transaction. Routine maintenance by some alumina refineries in Shandong tightened supply in north China, allowing local refineries to hold their offers relatively firm at around 2,920 yuan/mt. However, with the continuous inflows of alumina from south-west China, alumina prices in north China will face downward pressure. Following purchases by large aluminium smelters, transactions in the alumina market will become muted again. The current alumina market is in a buyer’s market, which threatens to send alumina prices in Shanxi below 2,900 yuan/mt.

With the release of new alumina capacity, sell-off by alumina refineries in low-cost regions, such as Guangxi, is likely to occur, and the negative effect will gradually spill over into high-cost regions like Shanxi and Henan.