China Nonferrous Metals News
Aladdiny: Domestic alumina refineries are still under pressure from a shortages of coal and bauxite together with relatively high alumina inventories.
Coal supply shortages have hit refineries harder in Shanxi, Shandong and Henan than those in other regions. Refineries in Guangxi and Guizhou currently have reasonable coal supply.
Domestic alumina refineries are all facing shortfalls of domestic bauxite supply, but large SOE refineries under the Chalco Group and SPIC Group with captive bauxite mines have been least affected. However, some Shanxi and Henan refineries including Xinfa Chemical, Heung Kong Wanji, Xing ‘an Chemical and Fusheng Aluminium have been forced to cut or suspend operations due to bauxite supply shortages. The momentum of alumina capacity cuts is likely to scale up on slow resumptions of privately-owned mines; a result of the extended holiday, lack of workers and stringent requirements for restarts. In terms of bauxite imports, most refineries made orders before the COVID-19 outbreak and have seen ample stocks at Chinese Ports. Chalco Zhongzhou, Shandong Aluminium, Weiqiao Group and Xinfa Group all have adequate stocks of imported bauxite to sustain operations in the short-term. East Hope Sanmenxia recently took delivery of about 20 kt of imported bauxite from Rizhao Port Shandong. At present, with mounting bauxite at Chinese ports, road and rail transport remains crucial to domestic refineries.
Some integrated alumina refineries with long-term orders have relatively high inventories, such as Jinbei and Huayin. Some refineries reliant on road transport such as Senze and Huaxing also have a high level of inventories. With traffic restrictions lifting and drivers gradually returning to work, pressure on logistics is likely to ease and inventory levels at affected refineries can be expected to decline in the short term.
As of 17th February Monday, completed domestic alumina capacity reached 85.97 mtpy, with 64.4 mtpy (74.9%) operational.