Chinese alumina refinery Kaiman Aluminium has reduced its production by 50pc citing a short supply of bauxite. The production cuts have been implemented from April 19 and are expected to continue for over a month till supply is restored.
Hangzhou Jinjiang Group owns the Kaiman alumina refinery, which is in Sanmenxia city in Henan province. The refinery has an annual production capacity of 2.1mn mt. Due to the production cut, the market will experience a shortfall of nearly 87,500mt of alumina which could become a cause of concern for China’s domestic alumina market. China produced 73.13mn mt of alumina in 2020.
Local media reports attributed the production cuts to increased environmental inspections in Henan, Shanxi, and other places. Earlier, manufacturers relied on ore imports, however, higher freight charges could boost primary aluminium prices in the near term.
Many alumina factories in Henan have announced production cuts and few others have decided to stop using imported ore. Chinese imports of bauxite may show a declining trend in April and May, reported local media. Imports data released by the customs department showed China imported 10.10 mn mt of bauxite in March 2020, which is 1.02pc higher from the prior year. In March, China imported 5.73mn mt of bauxite from Guinea, 3.09mn mt from Australia, and 1.21mn mt from Indonesia.