China Nonferrous Metals News
Northern refineries in China faces worsening losses at present, in the wake of continued falling alumina prices. According to Antaike, full production costs of northern refineries stand between RMB 2,600~2,700/t, higher than the current transaction price of RMB 2,500/t or lower.
One Henan refinery has reportedly cut production by 400 kt after a Shanxi refinery announced that it would start maintenance as of last week. Antaike data shows total alumina capacity cuts amount to 1.5 mtpy so far this year. Although massive production cuts have not as yet taken place across China, domestic refineries are not keen to operate given operational losses – led by weak prices and a glut of alumina. Some domestic refineries increased output in response to an earlier jump in alumina prices, thanks to reduced output at a Jiaokou refinery in Shanxi, however, this situation has changed. Antaike forecast domestic alumina output will decline considerably in the short-term, buoying alumna prices. Looking forward, domestic alumina prices are likely to halt their downward trend and lift significantly if an increasing number of refineries cut operations – either partially or completely.