CBIX up as Australian prices rebound. CBIX tracked higher during...

CBIX up as Australian prices rebound. CBIX tracked higher during the week, up 2.4% (US$1.1) to US$48.0/dmt on the back of higher ViU-priced cargos from RTA's Gove and Weipa mines. Gove material now appears to be tracking noticeably higher than a month ago, at approximately US$55/dmt (ViU adjusted), as bauxite prices follow alumina prices higher. In the absence of any significant movement in freight rates, these higher prices are likely to report directly to earnings.

Meanwhile, Malaysian FOB prices remain unchanged, as the larger miners gear up to restart operations once the ban is lifted in around two months’ time. Exports of stockpiled material continue, with prices still quoted at US$25-26/dmt FOB for unwashed material and US$37/dmt FOB for washed material.

Chinese domestic alumina prices have reversed the recent trend, with the north China price down -4.7% (RMB90/t) to RMB1,814/t (US$272/t including VAT) and the south down -1.1% (RMB20/t) to RMB1,820/t (US$273/t including VAT). We attribute the fall in domestic alumina prices to the restart of a significant portion of domestic refining capacity (estimated at 5 MTPY).

Freight rates edged higher again for both Panamax and Capesize vessels on the back of slightly higher shipping fuel prices and vessel charter rates.