Bauxite prices in China register slow rise in Henan and Shanxi throughout August

Despite tight bauxite supply in Shanxi, due to environmental scanning, local market prices for bauxite rose slightly over August and September. According to Shanghai Metals Market report, the average price for Bauxite for August and September has not registered much change. The average prices of bauxite for August and the September till date is shown in the table below:

Only the Shanxi and Henan provinces have registered a growth in bauxite price.  We can see the growth of bauxite price in Shanxi in August in the following graph. The province has gone through rigorous environmental checks. The mines lacking production licenses were ordered to close operations by September 14. 

Alumina prices were subdued because of the news of aluminium capacity cut and resulting slow demand for alumina in China. This discouraged alumina producers to increase production keeping bauxite demand in check. This could be one reason why bauxite prices in Shanxi did not register a significant leap despite tight supply. However, alumina prices are on the rise recently.  This is expected to raise bauxite demand as well as price in September.

In the import market, Australian bauxite prices dropped from USD 45.30/t in the beginning of August to USD 44.20/t or RMB288.61/t at present.  

In another update, SMM says that aluminium stocks in China’s seven major markets began to fall after frequently refreshing record highs. According to latest SMM statistics, the total stock in seven China market dropped to 1609 thousand tonnes on September 11 from 1641 thousand tonnes on September 7. The trend in aluminium stock will have a significant impact on bauxite and alumina prices in the near term.