Australia alumina: Prices fall on worsening smelting margins
Wednesday, 16 May 2012 | 00:00
The alumina market has fallen further, with low metal prices fueling anticipation of deeper global smelter run
cuts, and dampening demand for alumina. Chinese participants also expressed less anxiety about access to Indonesian bauxite.
Platts alumina price benchmark at $317/mt FOB Australia was down $1.50/mt from a day ago. The bid-ask spread was between $315/mt and $319/mt.
Chinese participants appeared to be less keen on spot alumina imports compared with recent weeks, voicing concerns about the slowing domestic economy, and weak aluminium price. There was no alumina shortage in China, in terms of port stocks and domestic output, sources said.
"Most Chinese buyers are not really short. They [were] buying only because they felt the price was good," a trader said. Although Australian tonnage remains discounted to China's domestic market, the bearish LME aluminium trend and anticipation of weaker prices, have reduced demand for imported alumina, he said.
Two traders said the Chinese market had fallen below $345/mt CIF. One put the market at $342/mt CIF China and $315/mt FOB Australia. The other reported receiving a recent buy inquiry at below $340/mt CIF China. Three ship operator and charterer sources said it would cost $27/mt to ship 30,000 mt in June from Western Australia to China's Qingdao.
Consumers in the Middle East have bought all the alumina they will need for the rest of the year. An alumina producer said it would expect a seller to start discussions from about $319/mt.
China's domestic alumina price in Henan province was stable at Yuan 2,730/mt ($433/mt) ex-works. The Guangxi market was around Yuan 2,650/mt.
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