Prices have soared in recent weeks, sending Metal Bulletin’s daily fob Australia alumina index to fresh highs every few days.

The benchmark index was last calculated at $672.50 per tonne on Thursday April 20, 2018, up 92.2% compared with March 1.

The most recent and most significant rally from $477.16 per tonne to $672.50 per tonne, a gain of 41% in just one week since April 12, has been the result of the United States Department of the Treasury’s decision to place sanctions on UC Rusal.

The Russian aluminium producer subsequently announced force majeure on some of its alumina shipments, believed to be from Ireland and Jamaica, causing buyers to hike their bids to secure prompt spot units in their required location.

Spot material has traded as high as $800 per tonne in the Atlantic.

But the latest rally started from a high base. The market had already tightened considerably, especially in the Atlantic, with Hydro’s Alunorte refinery in Brazil operating at 50% capacity since late February, after concerns that severe rainfall had resulted in water contamination to nearby rivers.

As a result, spot alumina prices jumped 36.4% between March 1 and April 12. In addition, the price differential available on Brazilian cargoes compared with the Australian benchmark price, swung from a $1.35-per-tonne discount to a $12.15-per-tonne premium between March 2 and April 12, according to Metal Bulletin’s fob Brazil alumina index.

Such acute regional tightness and sharp price gains have brought alumina supply and trade flows into the spotlight.

Back in 2015, when alumina prices were languishing around $200 per tonne, cuts to supply were felt in the Atlantic, with the effect of tightening the regional market and creating a fairly consistent Atlantic premium.

In contrast, new or increased supply has emerged in the Pacific - one of the factors behind a review and change to the specifications of Metal Bulletin’s fob Australia index in October 2017 to include normalized Pacific trades.

Here, Metal Bulletin looks back at the past three years of alumina supply disruptions and introductions, including the origins which could step up to fill the current supply gap.



Susan Zou in Shanghai contributed to this article.