Alumina Prices Hit Record High, Squeezing Aluminum Producers’ Profits as White Fused Alumina Market Surges

Since October 22, the price of alumina futures in China’s domestic market surpassed the 5,000 yuan per ton threshold, stabilizing above 5,100 yuan and reaching historical highs. This figure represents a near doubling since the product was introduced a year ago. In the spot market, alumina prices have also approached 5,000 yuan per ton, marking the highest level in over a decade.

Impact on Aluminum Producers’ Profitability
As a key raw material in electrolytic aluminum production, alumina’s soaring price has significantly squeezed the profit margins of aluminum companies. Since May, profit per ton has fallen by over 1,000 yuan, pushing some firms into negative margins. With alumina prices rising, other sectors in the aluminum supply chain are similarly impacted.

In the wake of this surge, the market for white fused alumina has also experienced a significant uptrend. As a crucial component in abrasive and refractory materials, white fused alumina prices have climbed continuously over the past month, leaving many companies scrambling to keep pace. Industry insiders have labeled this phenomenon the “Crazy White Fused Alumina” market, highlighting the intensifying global supply-demand imbalance.

Reasons Behind Price Surge
The primary drivers behind these price hikes are supply-side constraints. Domestic bauxite production has been hampered by environmental regulations, and reliance on imports continues to increase. Meanwhile, Guinea, a key supplier, has faced disruptions due to weather, policy changes, and shipping delays. Overseas alumina prices have also reached $680 per ton, further inflating import costs and tightening the supply balance within China.

Market Outlook
Analysts suggest that due to persistent supply-demand imbalances, alumina prices are likely to remain elevated in the short term. Despite increases in domestic electrolytic aluminum production, high alumina costs are expected to maintain their influence, especially through the fourth quarter. For the white fused alumina market, sustained price increases are projected to keep pressure on refractory and abrasive materials industries, likely extending this trend into the coming months.