Upstream aluminium recap: EU seeks stricter sanctions on Russia; Japan’s Q1 shipment premiums remain high after negotiations
The primary aluminium sector in the upstream industry particularly captured significant attention this week with intriguing news and updates that may lead to a change in decision-making regarding metal buying and selling, investments in projects, and export or import commodities. In case you have missed the stories, here are their briefs.
Ten European Union member states have jointly appealed for stricter sanctions on Russian metals, including aluminium. The demand is led by Poland, who will assume the rotating presidency of the European Union Council from January 2025. This initiative aims to curtail Russia’s revenue from metal exports since it is a critical source of income after fossil fuels.
Some Japanese buyers have agreed to $228 per tonne for their Q1 2025 aluminium shipment premiums, compared to $230-260 per tonne previously offered by global producers like South32 and Rio Tinto. Nonetheless, despite the decline, it is the highest premium since 2015 and 30 per cent more than the premium for the ongoing quarter of $175 per tonne.
To know why the premiums are high that the earlier quarter, read the full news: https://www.alcircle.com/news/japanese-aluminium-buyers-settle-on-new-premium-30-higher-than-q4-but-lower-than-previous-offer-112806
South32 has provided an update that Mozal Aluminium Smelter in Mozambique has successfully protected the safety of its workforce amid the ongoing civil unrest. As per the report, there have been no security incidents at the facility. In the earlier week, the Australian company had announced the withdrawal of its production guidance for the smelter due to escalating civil unrest in the region on December 10, 2024.
To get further insights into the story: https://www.alcircle.com/news/operational-stability-at-mozal-aluminium-maintained-despite-civil-unrest-reports-south32-112855
According to a report this week, China imported 280,000 tonnes of aluminium, including unwrought aluminium and aluminium products, in November, which reflected a 17.6 per cent fall Y-o-Y. Nonetheless, from January to November, the country’s total imports witnessed a 26.2 per cent rise, amounting to 3.45 million tonnes.
IMIDRO reported that Iran produced 400,425 tonnes of aluminium ingots during the first eight months of the Iranian calendar year starting March 20, 2024. That marked a decline of 4.56 per cent compared to 419,573 tonnes produced during the same period last year.
Japanese industry giant Sumitomo Chemical has announced its decision to surrender 2.97 per cent stake in Nippon Amazon Aluminium Co., Ltd. (NAAC) to YKK AP Inc for an undisclosed sales amount. This move, coupled with the previously announced sale of shares in two overseas aluminium smelting companies in May 2024, marks the company's complete withdrawal from the resale business of imported aluminium ingots.
To know more: https://www.alcircle.com/news/major-exit-sumitomo-chemical-pulls-out-of-aluminium-smelting-and-resale-businesses-112857
Rio Tinto has appointed Georgie Bezette as its new Chief People Officer, succeeding James Martin, who will retire at the end of this year.
To know more: https://www.alcircle.com/press-release/rio-tinto-appoints-new-chief-people-officer-112846
Hydro has announced to invest NOK 200 million (US$17.66 million) in establishing a new sow casting line at its Husnes site, aiming to enhance the flexibility of the primary aluminium casthouse and widen the plant’s product offerings.
To know more: https://www.alcircle.com/news/hydro-strengthens-husnes-operations-with-nok-200-million-sow-casting-line-investment-112850
Very recently, Century Aluminium witnessed a 13 per cent decline in share price, causing concerns among shareholders. To know how this has impacted the company’s market position, read: https://www.alcircle.com/news/century-aluminum-s-stock-dips-12-w-o-w-yet-long-term-returns-remain-robust-112847
Updates on raw materials market
On price front, China’s domestic alumina price has seen a downward movement throughout the week on the Shanghai Metals Market graph, caused by subdued demand for raw material due to production cuts at smelters as directed by the environment protection policy for the ongoing winter heating season. The last day of the week, December 20, saw an average price of alumina standing at RMB 5,750 (approximately US$ 788) per tonne, reflecting an RMB 7 decrease from the previous day's session.
Chevron, one of the world's leading integrated energy companies with a presence in Australia for over 70 years, has reportedly entered into an agreement with Alcoa to supply 130 petajoules of natural gas for 10 years from 2028. The gas will be sourced from Chevron’s Gorgon and Wheatstone facilities, destined for Alcoa’s alumina refineries in Western Australia.
To know more: https://www.alcircle.com/news/chevron-australian-secures-10-year-gas-supply-deal-with-alcoa-112819
Alpha HPA has secured $400 million in debt financing to advance its High Purity Alumina (HPA) First Project in Gladstone, Queensland. The funding is supported by Export Finance Australia (EFA) and the Northern Australia Infrastructure Facility (NAIF) to support Alpha to develop Australia’s first large-scale high-purity alumina processing facility.
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