Vietnam's Vinacomin to Withdraw Packing Option for Alumina Sales

Vietnam's Vinacomin plans to change the terms of its alumina sales contracts, giving the seller rather than buyer, the option of shipping in bulk or bags, a company official said Thursday.

Vinacomin's ability to ship in bulk would depend on "shipping times" and "logistic conditions," he said.

Alumina typically trades in bulk, as the majority of aluminum smelters worldwide vacuum-lift the tons onto a closed conveyor system linking their plant and port.

China is one of few exceptions. A large number of Chinese smelters are deeply inland, and transport alumina packed in bags, transported by trucks.

The change in Vinacomin's terms may not matter too much to Chinese buyers, although discharging bags is slower, requires more labor, and is thus more costly, sources said.

Also, the process of discharging bags may raise the risk of contamination, when shredded bag fragments inadvertently come into contact with the alumina, a trader said.

Market participants said a large number of global smelters do not have the gear and manpower to discharge alumina in bags, slit them and then transfer the alumina to the conveyor system.

A customer thought the change in terms may have been driven by Vinacomin's need to regain more control over loading rates at its loading port in Go Dau, Dong Nai province.