Chinese refiners start raising offers for December spot alumina

Some Chinese alumina refiners this week started to raise spot offers for alumina to be delivered in December, confirming market talk that they had discussed and agreed to the hike during a local industry event late last week.

Several refiners told Platts Monday that they were considering lifting offers, but had not yet done so. On Tuesday, major Shanxi refiner Xinfa Group was heard to have started quoting at Yuan 2,900/mt ($472/mt) cash to partial credit basis, up from Yuan 2,800-2,850/mt.

Another Shanxi refiner Luneng Jinbei had been offering Yuan 2,900/mt cash since mid-November following a 33% cut in its production run rate due to technical issues.

On Wednesday, Henan refiner Huiyuan Aluminum was quoting December spot at Yuan 2,900/mt, also up from around Yuan 2,850/mt cash, with another Henan refiner Zhongmei Aluminum also heard quoting at similar levels.

A third Henan refiner, Wanji Aluminum, told Platts Wednesday that they would only start offering December spot after December 10, and was planning to quote Yuan 2,800-2,850/mt cash to partial credit basis, up from Yuan 2,700-2,750/mt previously.

In the south, Guangxi refiners were also said to be considering higher offers, but no actual higher quotes were heard Wednesday.

A source close to major Guangxi refiner Huayin Aluminum said Tuesday offers for Huayin materials remained at Yuan 2,700-2,750/mt, with prices pegged at Yuan 2,650-2,700/mt cash, generally unchanged from recent weeks.

Refiners continued to attribute the higher offers to steady demand and limited spot alumina supply, but many market participants remained doubtful whether trades can be done at the new levels as domestic aluminum prices remained low.

"Refiners are trying, but we'll have to see if any actual trades can be settled higher, especially since domestic aluminum prices just fell again this week," a Henan refiner source said.

On Wednesday, the Platts Henan spot alumina price remained unchanged at Yuan 2,800/mt for 70:30 cash and credit payment terms.

The front month December aluminum contract on the Shanghai Futures Exchange stood at Yuan 13,350/mt on Wednesday, down from Yuan 13,650/mt last week.

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