Last week, domestic spot alumina prices moved steadily with a weak bias, and market trading sentiment was muted. As of July 17, the weighted national average spot price for smelter-grade alumina with a minimum purity of 98.6% stood at Yuan 2,750/tonne, dropped Yuan 12 /tonne from a week earlier, according to Mysteel's price assessment.
On the supply side, domestic alumina operating capacity stands at around 96.2 million tonnes per year. Recent capacity fluctuations were mainly concentrated in Guangxi and Shanxi. Maintenance at a Guangxi alumina refinery is progressing, with one production line having resumed operation and its operating capacity raised to 3 million tonnes per year, while recovery of the remaining capacity will take more time. Maintenance at a Shanxi alumina refinery has concluded, with two lines gradually resuming operation, though full capacity release still requires some time. As of last Thursday, July 23, 2026, the national alumina capacity utilization rate was 80.12%, up 0.52 percentage points week-on-week.
Last week, China's alumina traders' inventory stood at 6.37 million tonnes, up 18,000 tonnes week-on-week. The impact of severe convective weather weakened last week, significantly improving transportation timeliness in some regions and easing in-transit inventory pressure. Alongside the steady restart of a few alumina enterprises recently, refinery inventories have increased markedly, while port inventories remain in a slight uptrend.
In terms of demand, current domestic aluminum capacity deployment remains stable, operating at around 45.4 million tonnes per year, with output growth maintaining a steady and positive trend, providing strong support for alumina demand.
Regarding the reasons behind last week's price movement, newly commissioned capacity nationwide has largely entered a stable release phase, exacerbating regional supply divergence. South-to-North shipments continue to increase, while some refineries in northern and southern regions are gradually resuming production after maintenance, leading to cautious market sentiment.
Additionally, alumina futures prices have turned from strong to weak recently, denting market confidence. Buyers are reluctant to lift cargoes, holders remain willing to sell at lower prices, and weak demand is dragging prices down.
According to Mysteel statistics, alumina consumption by domestic aluminum enterprises last week was about 1.67 million tonnes, roughly flat week-on-week. Current high profits are driving aluminum enterprises to operate at high loads, with compliant capacity producing steadily, while a small amount of replacement capacity is still slowly ramping up, resulting in very limited short-term incremental supply and slow growth in raw material demand. Apart from a few aluminum plants conducting regular tenders recently, downstream buyers maintain rigid replenishment, mostly executing long-term contracts.
Although overseas markets have seen rising volumes and prices recently, domestic alumina spot prices lack rebound momentum, and spot transaction activity is sluggish. Increasing supply and high inventory pressures continue to cap upside price potential. Downstream aluminum plants mainly execute long-term contracts, procuring spot on a need-to basis with ongoing price-negotiation sentiment, sustaining the buyer-seller tug-of-war.
At current levels, positive factors to drive a market stabilization and rebound are insufficient. High alumina inventories and expectations of increasing supply continue to disturb the market and weigh on prices. Domestic alumina spot prices are expected to remain in a low-level weak oscillation pattern in the near term, with the trading range at Yuan 2,600-2,750/tonne.
Written by Regina WANG
wangjiaqie@mysteel.com
