abr 17

Mass shutdown in China lifts fused alumina prices

Fused alumina production has experienced mass shut downs in China due to a draconian environmental clampdown on polluting plants since early December, which has pushed spot prices higher.

Many fused alumina and bauxite producers in Shanxi and Henan provinces in China have been forced to shut down by local government since 8 December amid worsening pollution levels in the region.

 

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abr 10

Fused alumina, bauxite spot prices rise

Chinese-origin fused alumina and bauxite spot prices gained as raw material and transportation costs rise. While many buyers are reluctant to accept the increase, some producers warned that the uptrend could continue amid supply tightness.
Chinese suppliers have raised offers for refractory-grade bauxite and fused alumina in the spot market as raw material and transportation costs jumped following Beijing’s move to cut truckload volume.
The Chinese ministry of transportation cut the maximum truckload volume for four-axle trucks to 31 tonnes, down from 40 tonnes previously, with effect from 21 September.
Furthermore, some market participants are also seeing a shortage of trucks, which further tightened transportation between production facilities to mine.
“Trucks are in tight supply, many drivers are reluctant to accept deliveries,” said a Henan-based fused alumina producer.
In addition, bauxite mine output in China has been capped due to the Chinese government’s restriction on new mining permit, a refractory-grade producer told IM.
Suppliers have raised their offers for all Shanxi-origin bauxite grades by $10/tonne week-on-week, according to IM assessment on 13 October.
Spot prices for Shanxi-origin, rotary kiln 85%/1.8/3.15 bauxite were assessed at $250-280/tonne on a FOB Xingang basis, while the 86%/1.8/3.15 material was at $280-290/tonne FOB, up $10/tonne week-on-week.
Meanwhile, 87%/2.0/3.2 bauxite, calcined kiln FOB Xingang was assessed at $300-325/tonne, while 88%/1.8/3.25 material at $330-360/tonne, also an increase of $10 compared to the previous week.
Fused alumina
Under the environment regulation, producers are legally required to switch to natural gas for production in China.

However, some plants are not connected to the gas grid and as a result, calcined bauxite production fell. As calcined bauxite is a raw material used for brown fused alumina production, the supply tightness has in turn capped BFA output.
Spot prices for 95.5% Al 2O3 min brown fused alumina (refractory sized 0-1,1-3,3-5mm) increased to $585-600/tonnes, up from $570-590/tonne in the previous week.
Sharp spikes in Chinese domestic alumina prices after October’s Golden Week holiday is also pushing white fused alumina (WFA) prices higher.
Chinese domestic alumina prices was assessed at a range of 2,200-2,500 yuan ($327-372) per tonne on a delivered in China basis on Thursday October 13, up from 2,050-2,100 yuan a week earlier, according to IM’s sister publication Metal Bulletin.
Consequently, refractory-grade WFA spot prices have been lifted by the rising raw material alumina cost.
Spot prices for 99% Al2O3 min WFA in 25kg bag rose to €625-650/tonne on a CIF Europe basis, up from €625-650/tonne previously, according to IM’s assessment on 13 October.
Producers warned that there could be further price increases in the coming weeks amid volatility in raw material cost.
“My offers to customers for the past two days will only have a five-day validity, as prices will increase again in two days’ time,” a Henan-based fused alumina producer told IM.
While another Shanxi-based bauxite and BFA supplier agreed that supply is tight they added that it is not severe enough to cause upward volatility in prices.
Some buyers are holding out for lower prices but sellers warned that supplies are running out during the wait, a bauxite producer and one trader said.
Furthermore, unlike in the past, many producers are not willing to sell at a loss, and some are even selective about their customers, a Tianjin-based trader said.
“The buyers are deceiving themselves, the market prices are still rising,” he added.
While many buyers are reluctant to accept the sudden increase in prices, they may slowly accept the higher rate by November, traders and producers said.
“I expect the impact would be more obvious in two-three months, we will see then if they [the buyers] would believe it or not,” one bauxite producer said.

abr 03

Alcoa’s Portland smelter rescued by federal and state government bailout

Victorian premier Daniel Andrews announces four-year deal to keep aluminium plant open and federal government will also contribute

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The Victorian government has announced a four-year deal to keep Alcoa’s Portland smelter open because of the vital role it plays in the economy. Photograph: Bloomberg/Bloomberg via Getty Images
The federal and Victorian governments have announced a rescue package for the Alcoa aluminium smelter in Portland, including $30m in federal funds in return for a guarantee it will stay open until at least 2021.
Malcolm Turnbull announced the package with premier Daniel Andrews in Portland, Victoria on Friday. It comes as Alcoa finalised a new four-year power supply agreement with AGL Energy.
The smelter and the future of its 650 workers was at risk after a major power outage in December knocked out more than half of its production capacity.
The Victorian government estimates the smelter creates more than 1,600 supply chain and indirect jobs and contributes $120m to the local area. Alcoa is the region’s largest employer and biggest taxpayer.
Under the agreement with the federal government, Alcoa will receive $30m for capital improvements and repairs to help it return to producing 300,000t of aluminium a year, its output before the outage. It must maintain output of at least 90% of this level.
If the smelter closes or reduces output before July 2019 it will have to repay the full $30m plus interest. If it remains open beyond July 2021 it keeps the money, with several graduated payment points if it closes between those dates.
Turnbull said the government was standing up for Australian manufacturing and export jobs.
“We were determined to make sure that we provided the support that secured your jobs, your future, Portland’s future,” he said addressing workers at the smelter.
Asked whether it signaled a change in stance on industry policy, Turnbull said Alcoa was a “very particular case” because it was a viable business that had been struck by an unlikely “catastrophe” when transmission lines to the plant broke down.
In a statement Andrews and Victorian industry minister, Wade Noonan, said the state would “make a significant contribution over four years to sustain the smelter”.
A spokesman for Noonan refused to disclose the amount of assistance being provided and at the press conference Andrews also refused to say, although it is reportedly more than $200m.
“There is a cost, of course. But it’s more of an investment and it represents value … for the Victorian taxpayer,” Andrews said, citing the fact the aluminium sector contributed $1bn to Victoria a year.
“We promised Portland workers we would leave no stone unturned in our efforts to keep the smelter open – and we have delivered certainty to thousands of local workers and their families,” he said.
At the press conference Turnbull credited the Australian Workers Union and its state secretary Ben Davis for support of the workers and the agreement.
“This is a great case of governments working together. As Ben Davis said – you never know, it might catch on! Let’s hope so!”

mar 27

Innovation and conservatism in technical ceramics

Technical ceramics (TGs) are an extended family of materials with several overlapping and undefined borders with other categories of engineered products.

Simply defined, TCs, also called advanced, engineered, special and fine ceramics, are materials whose thermal, electric and mechanical properties allow processes or products to run faster, at higher temperatures, in more extreme environment and last longer than other materials…

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mar 21

Smog and mirrors? China’s steel capacity cuts were fake, report says.

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When it comes to steel, China is faking it.

Faced with global condemnation for flooding world markets with cheap steel, China announced last year it had implemented ambitious cuts in steel capacity.

But a new report by Greenpeace East Asia and Chinese consultancy Custeel says that number was largely smoke and mirrors. Many of the plants China says it closed down were already idle, while production was restarted elsewhere and brand new plants opened.

In fact, China’s steel industry actually saw a net increase in operating capacity equivalent to twice Britain’s total capacity, the report concludes.

That’s bad news for the air in Beijing, but it could also inflame China’s trade relations with the United States and the European Union, which have repeatedly accused China of dumping cheap steel abroad and damaging their own steel industries.

Tens of thousands of European steelworkers demonstrated last year in Brussels and in Germany against cheap Chinese steel.

“Impressive as they seem, China’s current steel capacity reduction targets won’t suffice to limit oversupply, as local governments maneuver to shield zombie steel mills and minimize the impact of the policies,” said Lauri Myllyvirta, Greenpeace global coal campaigner.

“Global markets are awash with steel and the people of northern China continue to choke on the industry’s major byproduct, smog. Increasing steel capacity makes neither economic nor environmental sense.”

China, which accounts for half the world’s steel production, has a total capacity of 1.1 billion metric tons (1.2 billion U.S. tons): It has announced plans to eliminate 100-150 million metric tons (110-165 million U.S. tons) of annual production over the next five years, but cutting capacity has so far done little to rein in output and exports.

Last year, it said it had far exceeded its initial target to cut capacity by 45 million metric tons (50 million U.S. tons), recording cuts of around 85 million metric tons (94 million U.S. tons).

But the report says that 73 percent of the announced cuts in capacity were already idle — in other words the plants were not operating. Only 23 million metric tons (25 million U.S. tons) of cut capacity involved shutting down production plants that were operating.

At the same time, some 54 million metric tons (59.5 million U.S. tons) of capacity were restarted, and 12 million metric tons (13 million U.S. tons) of new operating capacity came online.

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