Domestic alumina spot prices ran stable-to-soft last week, with sporadic deals holding at small discounts. On the supply side, domestic alumina operating capacity rose to around 99.4 million tonnes per year. No new curtailments or maintenance shutdowns were reported; instead, restarts progressed smoothly. A large Shanxi refinery that began feeding last week has gradually returned to full output, lifting regional running capacity by about 2.2 million tonnes per year. In Guangxi, one major refinery restored stable output at 10,000-11,000 tonnes per day after resuming production, while another Guangxi refinery still has one calciner under maintenance, scheduled to restart around Aug 24, 2026, with normal running capacity near 2.3 million tonnes per year.
The price softness last week reflects that, as domestic restarts and new units approach full load, steadily rising regional output has pushed sellers to widen discount selling. The north-south spread keeps widening, and southward supply flowing north continues to pressure northern markets. As of last Thursday (Aug 20, 2026), national alumina capacity utilization rate averaged 82.79%, up 1.81 percentage points week on week. Mysteel notes capacity changes were mostly routine maintenance, but a large northern refinery's restart drove running capacity to a cyclical high.
Mysteel estimates domestic alumina consumption at about 1.6762 million tonnes last week, a slight increase week on week. Aluminum capacity was little changed at around 45.42 million tonnes per year, with smelters still replenishing on dips. Overseas spot alumina deal prices varied widely, driven by demand recovery from new and restored overseas smelting, plus sudden overseas curtailments and logistics disruptions. Still, elevated overseas spot levels are more local than a fundamental global reversal. China's alumina export window was not fully open, so excess domestic capacity cannot be absorbed abroad near term.
Taken together, domestic alumina traders' inventories stood at 6.565 million tonnes, up 73,000 tonnes week on week. Aluminum smelters held ample raw-material stocks, mostly honoring long-term contracts with occasional dip-buying. The restarted alumina refinery in northern China primarily supplies in-group downstream smelters, so overall feed inventories still trended up. Deepening supply-demand mismatch and no basis arbitrage room left traders under growing sales pressure, with in-transit and refinery inventories building.
Near term, soft domestic fundamentals, high traders' inventories, and pending new-capacity releases cap prices. But the bauxite prices stay firm with minor upticks, leaving cost support intact. Domestic alumina is expected to keep grinding lower slowly, with industry margins narrowing further; spot is seen ranging Yuan 2,550-2,650/tonne.
Written by Regina WANG
wangjiaqie@mysteel.com
