The shutdown of 1.5 million tonnes-per-year of alumina refining capacity in China will curb oversupply of the aluminium raw material and see prices currently languishing near two-year lows reach a bottom, Antaike says
The production cuts - 1 million tonnes of which is only for 30 days of maintenance from July 20 - affect the key alumina-producing regions of Shanxi and Henan, the research house says in a note.
Spot alumina prices in northern China sank to as low as 2,490 yuan ($362.18) a tonne on Wednesday, the lowest since August 2017 due to oversupply.
The production cost for alumina refiners in northern regions is as high as 2,700 yuan, says Antaike, the research arm of the China Nonferrous Metals Industry Association, meaning some alumina firms are suffering "serious losses."
Alumina prices have been on a "roller coaster" in China since the second quarter, Antaike noted, referring to environment-related closures in Shanxi in May that briefly took prices above 3,000 yuan a tonne. ($1 = 6.8751 Chinese yuan) (Reporting by Tom Daly; editing by Gopakumar Warrier)
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