China's Alumina Prices Fall Below Costs
China’s alumina prices fall below costs
Editor: From: chinamining Click?52 Date: 2009-01-07 09:53:58
Chalco, China’s top aluminum producer, cut its alumina spot price again last Sunday to 2,000 yuan per ton, down 52 percent from last year’s highest point of 4,200 yuan per ton.
Currently, Chinese private alumina enterprises charged even lower, about 1,850 yuan per ton.
When the alumina price has fallen below production costs, very few deals are concluded on the market, said a market source.
China’s aluminum enterprises are weathering the cold winter due to the demand shrinkage and price slump on both Chinese and global aluminum markets.
“China’s(cnmining) alumina is still oversupplied. If the demand continues weakening, the price may drop again,” said analyst Shi Weiping with Oriental Securities.
But a researcher with a fund company noted that since the production costs for alumina averages between 2,500 yuan to 2,800 yuan per ton, there isn’t much space for further drop in alumina price.
On soft demand and overstocking, alumina price in China has been decreasing since June 2008. Chalco cut alumina price for four times in the second half of 2008, that is, from 4,200 yuan to 3,500 yuan per ton on June 3; from 3,500 yuan to 3,200 yuan per ton on August 1; from 3,200 yuan to 2,900 yuan per ton on October 1; and from 2,900 yuan to 2,600 yuan per ton on November 10.
In early November, Chalco announced to reduce or halt production in provinces of Shandong, Henan, Liaoning and Inner Mongolia by a combined annual capacity of 720,000 tons, or about 18 percent of its total production capacity.
Editor: From: chinamining Click?52 Date: 2009-01-07 09:53:58
Chalco, China’s top aluminum producer, cut its alumina spot price again last Sunday to 2,000 yuan per ton, down 52 percent from last year’s highest point of 4,200 yuan per ton.
Currently, Chinese private alumina enterprises charged even lower, about 1,850 yuan per ton.
When the alumina price has fallen below production costs, very few deals are concluded on the market, said a market source.
China’s aluminum enterprises are weathering the cold winter due to the demand shrinkage and price slump on both Chinese and global aluminum markets.
“China’s(cnmining) alumina is still oversupplied. If the demand continues weakening, the price may drop again,” said analyst Shi Weiping with Oriental Securities.
But a researcher with a fund company noted that since the production costs for alumina averages between 2,500 yuan to 2,800 yuan per ton, there isn’t much space for further drop in alumina price.
On soft demand and overstocking, alumina price in China has been decreasing since June 2008. Chalco cut alumina price for four times in the second half of 2008, that is, from 4,200 yuan to 3,500 yuan per ton on June 3; from 3,500 yuan to 3,200 yuan per ton on August 1; from 3,200 yuan to 2,900 yuan per ton on October 1; and from 2,900 yuan to 2,600 yuan per ton on November 10.
In early November, Chalco announced to reduce or halt production in provinces of Shandong, Henan, Liaoning and Inner Mongolia by a combined annual capacity of 720,000 tons, or about 18 percent of its total production capacity.
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