WEEKLY: China's alumina inventory build persists despite output cuts

China's alumina output edged down last week as several producers in Henan and Guizhou provinces and in the Guangxi autonomous region scaled back production to carry out 10-14 days of maintenance, either to curb atmospheric pollution or to control operating costs.

News of the production curtailments provided brief support to the alumina futures market late last week. The most-traded May 2026 alumina contract on the Shanghai Futures Exchange jumped 1.8% during Thursday's daytime trading session from the prior day's settlement price.

In contrast, spot alumina prices continued to weaken over the same week, mainly weighed down by steady inventory accumulation. Mysteel assessed the national average spot price for smelter-grade alumina with a purity above 98.6% at Yuan 2,655/tonne ($382/t) on January 22, down 0.6% from a week earlier.

Alumina inventories climbed further despite the output cuts. Mysteel's latest survey showed that total alumina stocks across the country's ten major ports, 44 alumina producers, 89 primary aluminum smelters, and rail yards or in transit had increased by 1.7% from a week earlier to a new record high of 5.49 million tonnes as of January 22.

The inventory buildup has now continued for more than seven straight months. Moreover, the on-week rise during the survey week was slightly larger than the average 1.4% increase recorded over the prior three weeks, Mysteel Global noted.

Contributing most to last week's accumulation were rising portside alumina stocks. The survey findings showed that alumina inventories at the ten major Chinese ports monitored by Mysteel had surged by 23.5% on week to 168,000 tonnes by January 22, driven mainly by new arrivals of imported material at Bayuquan port in Liaoning province.

Moreover, colder weather in North China disrupted transportation, causing alumina stocks at producers and rail yards to rise by 4.3% and 2% on week to 240,000 tonnes and 1.35 million tonnes, respectively.

On the demand side, alumina consumption among primary aluminum smelters remained largely steady. During January 16-22, the total volume of alumina consumed by the same 89 surveyed smelters inched up by 0.06% on week to 1.65 million tonnes, according to Mysteel's tracking data. 

Written by Iris Pang, pangjunyu@mysteel.com