The price of spot alumina in China has fallen 11 percent in less than a month due to weaker demand as some aluminium smelters' production has been affected by snow-related power shortages, industry officials said on Wednesday.
Weak demand for primary aluminium, which is made of alumina, was also dis(Chalco), the world's third-biggest alumina producer whose spot prices have held at 4,200 yuan ($587) a tonne since mid-December.
"Alumina prices started falling last week. The price is about 3,950 yuan a tonne now," said a trade manager at one large smelter. Weiqiao Aluminium, China's second-biggest alumina supplier after Chalco, was offering spot alumina at 4,000 yuan a tonne, a company trader said. The offer was 4,500 yuan in mid-December.
"We lowered offers to reflect the market situations," the Weiqiao trader said. The worst winter weather in decades blocked roads and damaged power networks. Combined with coal-related power shortages in southern provinces in late January to early February, that forced many electricity-hungry aluminium smelters to shut down facilities or reduce production.
In Guizhou, facilities with some 800,000 tonnes of aluminium capacity are expected to restart operations next week with the restoration of major power networks, expected before Saturday.
But Zunyi Aluminium would not resume operations until March because it has not finished preparations. Guizhou's shutdowns could reduce consumption of alumina by at least 133,000 tonnes. Two tonnes of alumina are needed for 1 tonne of primary aluminium.
Comments
Comments are closed.