Shanghai Nonferrous Metals News
SMM: As of 15th July, weighted averaged alumina prices in five major producing regions surveyed by SMM had fallen to RMB 2,582/t, continuing the downward trend begun in mid-June. According to SMM, actual transaction prices were even lower in the northern market, with the lowest point below RMB 2,500/t. On the back of falling alumina prices, profit margins within the industry have shifted downwards to aluminium smelters.
According to SMM, the weighted averaged full cost for primary aluminium smelting will be RMB 13,105/t (based on internal pricing) in July, a decline of RMB 717/t from June. Given SMM putting aluminium ingot prices at RMB 13,739/t during the first two weeks of July in the spot market, most domestic smelters with 29.23 mtpy capacity (79.9% of the national total) can be seen to have positive margins. In comparison, when aluminium ingot prices were at RMB 13,974/t and alumina prices at relatively high levels in June, only 15.26 mtpy of primary aluminium capacity (41.8% of the national total) was capable of some profit taking.