Shift in China's Alumina Market Dynamics: Reduced Imports and Increased Exports in 2024

China's Alumina

Navigating the Impact of Closed Arbitrage Opportunities

In 2024, China's alumina imports saw a significant decline, dropping by 22% from the previous year, as per customs data. This reduction was primarily attributed to the closure of import arbitrage opportunities starting in May, when rising global prices, due to tight supply, made imports financially unfeasible. The effect was stark in December, with imports plummeting by 94% year-over-year and 85% from November, directly linked to the continued closure of arbitrage.

China Emerges as a Net Alumina Exporter Amid Global Price Fluctuations

Simultaneously, China experienced a 43% increase in alumina exports in 2024, positioning the nation as a net exporter for the first time in years. This shift was driven by higher alumina prices outside of China during the third quarter, which encouraged producers to capitalize on more lucrative overseas markets.

Domestic Market Trends and Production Increases

Despite high domestic prices peaking in December, they began to decrease mid-month as aluminum producers initiated care and maintenance to cope with negative profit margins caused by high feedstock prices. In Shanxi province, a key production hub, alumina prices slightly fell by 2% month-over-month to 5,700 yuan per ton ($780/t) by the end of December. Nonetheless, the overall domestic output in December surged by 10.1% year-over-year, reaching 7.51 million tons. Throughout 2024, total production rose by 3.9% to 85.5 million tons, reflecting robust domestic production amidst global economic pressures.