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This morning, there were changes in futures and stock prices related to non-ferrous metal aluminum.

Shanghai Futures Exchange alumina futures quickly rose in early trading on the 21st, a number of contracts hit the daily limit, Shanghai aluminum futures also once followed the rise. In the A-share aluminum plate, Chang Aluminum shares opened with the limit, Tianshan Aluminum and Minfa Aluminum once followed the rise. On the evening of the 21st, alumina futures night trading continued to open higher.

Alumina futures trend

Trend of Chang Aluminum shares

On the news, according to Reuters, global mining giant Rio Tinto issued a statement on Monday local time that force majeure had occurred at its two alumina plants in Queensland, Australia.CasinoslotsNormal shipments were made, a decision stemming from a shortage of natural gas needed to maintain its operations.

The reporter learned from the industry that the operating capacity of these two alumina plants accounts for about 4% of the global operating capacity. The announcement of the suspension of shipments may be related to the natural gas pipeline fire in Queensland, Australia in early March 2024. The news is expected to have a short-term impact on the market, traders need to pay attention to the impact of market capital sentiment and guard against the risk of short-term volatility.

Force majeure occurred in two aluminum oxide plants of Rio Tinto

It is reported that on Monday, local time, Rio Tinto announced the occurrence of force majeure (force majeure) in the transportation of its two alumina plants in Queensland, Australia, specifically the Yarwun plant and the joint venture of Queensland Alumina Co., Ltd. and Russian joint company Rusal International PJSC.

Rio Tinto's decision stems from continuing challenges to natural gas supplies in the region and disruptions caused by an earlier Queensland fire, hampering the ability of alumina plants to operate at full capacity, according to people familiar with the matter. Rio Tinto's force majeure statement is expected to affect only third-party sales of alumina and not Rio's internal aluminum business.

According to the data, Rio Tinto is a global leader in mining and metals, and the company has large-scale vertical integration operations in the aluminum industry, including bauxite, alumina plants and smelters. In 2023, the actual output of Rio Tinto's rights and interests bauxite mine is 54.6 million tons, with a guiding target of 53 million tons to 56 million tons in 2024.

China is the main market for Rio Tinto. Alf Barrios, chief commercial officer and chairman of Rio Tinto in China, said in an interview last year that the Chinese market accounts for more than half of Rio Tinto's revenue, mainly iron, aluminum and copper, and that China is an important business partner, talent and technology source for the company.

The fire disrupted the supply of natural gas

Industry insiders told reporters that the insufficient supply of natural gas and the overall shortage of overseas alumina stocks may constitute a force majeure factor for Rio Tinto's two alumina plants to stop shipping. A natural gas pipeline fire in Queensland, Australia, in early March further contributed to a shortage of local natural gas supplies.

Zhan Dapeng, director of non-ferrous research at Everbright Futures, told reporters that according to Aladdin data, the operating capacity of the two alumina plants in which Rio Tinto announced force majeure fluctuated at 6 million tons per year, accounting for about 4 per cent of global operating capacity. If the outsourcing is stopped, it will have a marginal impact on the global alumina market.

Liu Peiyang, a non-ferrous metals researcher at Central Plains Futures, said that according to Mysteel research, due to a natural gas pipeline fire near Bauhinia Downs, Queensland, Australia in early March 2024, a reduction in natural gas supply led to a reduction in production and operation of the two alumina plants around Yarwun and Queensland (that is, the two alumina plants that stopped shipping this time).

Liu Peiyang said that the two alumina plants were expected to resume production around early June, but local natural gas supplies have not yet fully recovered and are expected to resume production in September. In addition, affected by the production reduction in the early stage, the two alumina plants had to maintain the implementation of the contract through spot purchase. However, due to the insufficient supply of natural gas, the overall shortage of overseas alumina spot and other force majeure factors, the short-term implementation of some contracts between the two alumina plants has been blocked.

Emotional influence or greater than fundamentals

Against the backdrop of recent large fluctuations in the bulk market as a whole, the two alumina plants of the Rio Tinto Group have stopped shipments, which may have a greater impact on short-term sentiment than actual fundamentals. Traders need to pay attention to the factors of market capital sentiment and guard against the risk of short-term price fluctuations.

Zhan Dapeng said that the global alumina production capacity is widely distributed. At present, 29 countries and regions have alumina capacity layout, mostly in countries and regions where bauxite resources are rich and electrolytic aluminum production is more concentrated. Among them, China has built a production capacity of more than 100 million tons, while overseas has a total production capacity of 80 million tons.

"the overall impact of this incident on the emotional side is greater than the actual fundamental impact. As the main production capacity of global alumina is concentrated in China, follow-up, there are still plans for resumption of production in domestic alumina plants, and there is a certain demand support for the resumption of southwest electrolytic aluminum to speed up the preparation of raw materials. Under the overall tight margin of supply and demand, the problem of ore supply is still the main logic of disk trading. Sustainable attention to this incident involves the recovery time of the two alumina plants, focusing on the progress of domestic mine resumption. " Zhan Dapeng judged.

Liu Peiyang believes that for alumina, there are three main logic in the domestic market at present: first, under the expectation of the Fed's interest rate cut cycle, the overall non-ferrous metals market is in an upward trend, driving the alumina price to strengthen; second, the degree of external dependence of bauxite, the raw material upstream of alumina, is relatively high, and the current shipping market fluctuates greatly, resulting in tight expectations for imported raw materials. Third, the resumption time of some domestic mines has not yet been determined, and the operating rate of alumina plants can not keep up with the increase of the operating rate of upstream and downstream electrolytic aluminum plants. Therefore, the alumina market may maintain a strong operation in the medium term, it is necessary to pay attention to the impact of market capital sentiment in the short term and guard against the risk of short-term fluctuations.