Influence of orders and supply on alumina inventory at Chinese smelters

According to the Shanghai Metals Market survey in early June, the accumulated inventory of alumina at aluminium smelters across China stood at 2.8815 million tonnes. The number of days of in-plant alumina stocks at Chinese aluminium smelters in early June was 12.78 days, considering that the national aluminium output was 3.632 million tonnes in May, with a daily output of 117,200 tonnes.

Alumina stocks at smelters, region-wise

In the Northwest Chinese regions, such as Ningxia, Qinghai, Gansu, and Xinjiang, some aluminium smelters had considerable alumina orders to deliver, which led to lower in-plant alumina inventories. Meanwhile, some smelters in the regions encountered a sluggish buying sentiment, leading to relatively stable inventory levels. Thus, the average days of in-plant alumina inventories were 15 to 30.

In Liaoning and Inner Mongolia, some aluminium smelters had poor long-term alumina order supply, leading to a Y-o-Y drop in in-plant alumina inventory levels than in previous years, with an average inventory duration of 7-15 days.

In regions like Shanxi, Henan, Shandong, Guangxi, Guizhou, and Chongqing, the long-term alumina order supply was stable, with an average in-plant inventory duration of 5 to 12 days.

In Yunnan, as a consequence of continuous production resumption and new capacities coming online, the in-plant alumina inventories were sufficient, maintaining a stable duration of over 20 days.

Hydropower reserves in Yunnan drive aluminium production

As heavy rains replenished hydropower reserves in Yunnan, enabling smelters to resume operations, China’s aluminium production in May reached a new high of 3.65 million tonnes, reflecting a year-on-year increase of 7.2 per cent. SMM anticipates further increase in domestic production in June, driven by ongoing operation recovery in Yunnan and the commissioning of new capacities such as Huayun Phase III in Inner Mongolia.