Despite shortages in the country’s northern reaches, the Aluminum Corp of China Ltd (Chalco) is not planning to increase imports of alumina unless and until prices reach a commercially-justifiable level. Such was the message conveyed by a company representative earlier this week.
Commenting to Reuters at the Shanghai Derivatives Market Forum on Tuesday, the deputy general of Chalco’s China Aluminum International Trading Co Li Guangfei said the economic case must be made first before imports would occur.
“We still need to look at the price. If the price is suitable we will import,” said Li.
“At present the import price is not too suitable.”
China has suffered from alumina shortages of late due to the shuttering of at least two refineries in Shanxi that were closed on account of concerns with red mud. A portion of Chalco’s 18.86 million metric tons per annum of alumina refining capacity resides in Shanxi, though none of it was part of the capacity closed in relation to red mud.
Though numbers are not yet in for May and June of this year, the month of March featured a sharp spike in alumina imports to the Middle Kingdom, as intake of the aluminium precursor doubled to a total of 60 thousand metric tons. Most Chinese traders expect even more of the same thanks to the coming supply squeeze, while at least one London-based trader reports a rise in inquiries for shipping alumina to Chinese buyers.
Closures of alumina refining capacity have already caught the attention of the domestic market, as prices on the spot market for imported alumina hit CNY3,140 (US$454.30) recently, representing a 7.9-percent spike since mid-May and setting a high in prices not seen since late last year.