Alumina spot price in China recorded growth of RMB49/t this week; A00 aluminium ingot price declined by RMB240/t

As the week comes to an end, let’s look back at the status of Chinese aluminium and input costs recorded throughout the week. The average alumina spot price during February 24-28 recorded interrupted growth of RMB 49 per tonne ranging between RMB 2,516 per tonne and RMB 2,565 per tonne, showed Shanghai Metals Market.

In the east, the price rallied by RMB 50 per tonne from RMB 2,520 per tonne to RMB 2,570 per tonne over the week, while that in the central and north, the price grew by RMB 40 per tonne and RMB 50 per tonne, from RMB 2,525 per tonne to RMB 2,565 per tonne and RMB 2, 530 per tonne to RMB 2,580 per tonne, respectively.

Limited availability of alumina due to production cut at several refineries in China amidst deadly Coronavirus whilst stable production of primary aluminium could be attributed to the continued growth in alumina spot price this week.

The Australian alumina FOB price during February 24-27 remained restrained at US$ 299 per tonne and on Friday, February 28, it grew to US$ 301 per tonne.

But despite the growth in the average alumina spot price, the A00 aluminium ingot price recorded downtrend throughout the week. The primary reason was the stable production of the metal while slow demand among downstream consumers amidst Coronavirus. The ingot price this week declined by RMB 240 per tonne ranging between RMB 13,410 per tonne to RMB 13,170 per tonne. However, only for a day, on February 26, the price increased by RMB 20 per tonne from RMB 13,410 per tonne to RMB 13,410 per tonne.

Increasing inventories due to the weak consumption of the metal have also been a reason behind the incessant fall in price. Over the week, the social inventories of primary aluminium increased by about 239,000 tonnes in total to stand at 1.385 million tonnes. On Monday, February 24, the inventories had grown by 84,000 tonnes over the weekend to 1.314 million tonnes, while on Thursday, February 27, they grew by another 71,000 tonnes.

In the downstream sector, aluminium billet inventories also recorded a hike this week by about 19,300 tonnes week-on-week to 212,400 tonnes, as of Thursday, February 27.

The price of aluminium alloys (ADC12), after remaining restrained at RMB 15,000 per tonne during February 24-26, dropped to RMB 14,950 per tonne on Thursday, February 25, and then to RMB 14,850 per tonne on Friday, February 26.

The prices of aluminium alloy (A356) and aluminium alloy (A380) also showed a downtrend ranging between RMB 14,100 per tonne and RMB 13,900 per tonne and RMB 15,900 per tonne and RMB 15,800 per tonne.

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