CHINA DATA: October primary aluminum imports up 47% on month

China's primary aluminum imports in October rose 47% month on month and 25% year on year to 139,663 mt, customs data showed Nov. 22.

Alumina imports fell 39% month on month to 219,434 mt.

China's primary aluminum imports were expected to remain at elevated levels as cargoes booked in September will reach domestic markets in the fourth quarter, industry sources said.

Meanwhile, alumina imports may not see a significant increase in November despite some profitable opportunities, market participants said.

Domestic alumina prices are under pressure amid a steady decline in primary aluminum prices and weaker demand from smelters due to ongoing output cuts faced by the industry.

Primary aluminum

The import arbitrage window is closing due to a significant drop in domestic primary aluminum prices over the past few weeks and widening import losses, sources said.

The most-active aluminum contract -- January -- for delivery on the Shanghai Futures Exchange closed at Yuan 19,205/mt ($3,010/mt) on Nov. 19, down 21% from Oct. 19, SHFE data showed.

The ratio between SHFE's most-active contract and London Metal Exchange's three-month closing price fell to 1.12 on the same day, from 1.22 on Oct. 20, excluding the exchange rate.

Alumina

China's alumina imports saw a month-on-month decline for the third straight month, led by higher seaborne prices and dampened demand from primary aluminum smelters curbs, market sources said.

In October, the volume imported from Australia -- the largest exporter to China -- fell 29% from a month earlier to 119,336 mt. Imports from Australia accounted for 54% of China's alumina imports.

Australian alumina was at a $34.00/mt discount to Chinese production on import-parity terms Nov. 19, from a discount of $10.30/mt available Oct. 20, S&P Global Platts data showed.

The discount calculation was based on the Nov. 19 assessments by Platts of Australian alumina at $398/mt FOB Australia and China's spot alumina at Yuan 3,580/mt ex-works Shanxi. Calculations also include freight rate of $48.10/mt for ship 30,000 mt from Western Australia to Lianyungang, China, Platts data showed.