HK Stock Market Move | CHINAHONGQIAO (01378) rose more than 5% in early trading, and the shortage of aluminum oxide is expected to continue. The company's aluminum oxide sector is expected to see increased profits.

CHINAHONGQIAO (01378) rose more than 5% in early trading, reaching a 4.05% increase at 12.32 Hong Kong dollars by the time of publication, with a trading volume of 2.54 billion Hong Kong dollars. On the news front, a responsible person from the China Nonferrous Metals Industry Association recently issued a reminder, stating that the trend of alumina prices is driven by irrational factors, with obvious speculation from excessive capital. According to current cost and price calculations, the average profit of the alumina industry has exceeded 2000 yuan/ton, which is unsustainable and should not continue. However, Tongguan Jinyuan Futures stated that overseas prices of spot alumina continue to rise, with domestic spot prices also on an uptrend, supported by tight supply. It is expected that alumina will not see a major adjustment in the near future, and there is optimism for high-level fluctuations. Minmetals Futures also indicated that the increase in supply in the current year is still limited, and the scarcity of alumina is expected to continue. Guosen pointed out that since 2024, due to factors such as tight supply of upstream bauxite and continuous disturbances in alumina plant maintenance, alumina supply has continued to tighten. This has led to a significant increase in alumina prices and improved profitability in the alumina sector. According to SMM, the theoretical profit of alumina in Q3 2024 was approximately 1069 yuan/ton, an increase of 886 yuan/ton compared to the previous year and 188 yuan/ton compared to the previous quarter. The company adheres to building an integrated industry chain structure upstream and downstream and actively integrates overseas bauxite resources. The upstream alumina business has been continuously improved, with the company's total annual alumina production capacity reaching 19.5 million tons as of H1 2024. While ensuring the stability of its own costs, the company further increases profits through the sale of alumina.