Chinese restocking surges Australian alumina prices

According to Platts report, thanks to Chinese restocking and LME aluminium price surge, there has been a $5/mt gain on the Australian alumina daily assessment as it closed at $325.50/mt FOB on Friday.

Although the market rate at the start of last week was $318-319/mt FOB Australia, a Chinese consumer/reseller admitted on Friday that they were prepared to pay $323/mt FOB Australia for a shipment between October and first half of November.

The week started with a seller’s guidance marked at $324-325/mt FOB Australi which by Friday rose to $328/mt. On Thursday, a late October shipment of 35,000 mt was sold by a producer at $325/mt FOB Western Australia LC at sight.

As local consumers are building inventories before the cold season arrives when rail service is a bit slow, the local alumina prices also surged by Yuan 40/mt.

The higher freight rates have also added to the alumina price surging it by a couple of dollars for CIF China buy rates. For a late September 30,000 mt alumina shipment from Western Australia to China’s Lianyungang port, Platts has assessed a Handysize freight rate of $21.50/mt on Friday. This is $0.75/mt higher than earlier that week and $2/mt higher than earlier that month.

With smelting cuts found globally, the future prospect of alumina is very lucrative according to consumer and trader sources. In the meanwhile unplaced western material is being continuously shipped to China where it is suspected of being stored away to reap the benefits of higher prices in future.

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