China spot alumina rises as metal prices firm, supply tightens

China's ex-works Henan spot alumina price edged up Thursday as market sentiment improved with domestic metal prices rising back above Yuan 14,000/mt ($2,270), and spot supply tightened.

Henan refiner' offers remained mostly around Yuan 2,500/mt full cash basis Thursday, unchanged since last week, but tradable prices stood at Yuan 2,440-2,460/mt for cash up to 70:30 cash and credit payment terms, up from Yuan 2,430-2,450/mt on Wednesday.

The front-month August aluminum contract on the Shanghai Futures Exchange closed at Yuan 14,040 mt Thursday, up from Yuan 13,915/mt on Wednesday, and also up from Yuan 14,005/mt a week ago.

Market participants have regained some confidence as aluminum prices recovered Thursday after falling back slightly on Wednesday.

"Spot supply is also quite limited in Henan, so trades will have to be higher if anyone buys now," a Henan smelter source said. August spot trades were also expected to pick up in the coming week, after talks were pushed back in the past week as buyers waited for clearer direction from domestic metal prices.

Meanwhile, in neighboring Shanxi province, spot offers were rangebound at Yuan 2,430-2,440/mt cash Thursday, with trades pegged unchanged at around Yuan 2,400/mt cash.

In south China's Guangxi region, spot offers stood at mostly Yuan 2,330-2,350/mt cash, with trades stable in the range of Yuan 2,250-2,280/mt.

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