Xinfa Group has closed two production lines out of four at its Jiaokou alumina plant, removing 1.3 million tonnes per year of alumina output after the local authorities launched a serious investigation into a red mud leakage at the plant in Jiaokou County, Shangxi province, a source from Xinfa Group confirmed to Fastmarkets on Monday.
Total production capacity at Xinfa Group’s Jiaokou plant is 2.6 million tpy, Fastmarkets reported previously.
Another producer, Huaqing Aluminium, has also been ordered to shut down 400,000 tpy of production capacity due to an environmental violation, sources familiar with the case told Fastmarkets on Monday.
Market participants expect Chinese consumers to be forced to turn to the import market as a result of these production cuts, which could lift global alumina prices.
“This case could bring huge...