East China Trading Atmosphere Strong, Central China Trading Sluggish [SMM Spot Aluminum Midday Review]

SMM May 25 reported:

During the morning session, the SHFE aluminum 2606 contract traded in a range, with the overall price center moving lower compared to the previous trading day. Some buyers had strong bullish sentiment, and as the impact of tax invoice reductions gradually eased, overall buying sentiment in the market improved somewhat, while some sellers held prices firm. The mainstream spot quotation in the market was around SMMA00 average to +10 yuan/mt. Today, the east China market shipments sentiment index was 3.06, flat MoM; the purchasing sentiment index was 3.16, up 0.06 MoM.

Recently, the price spread between central China and Shanghai was relatively small and higher than long-term contract prices. Downstream processing enterprises in the central China market had low buying sentiment and preferred long-term contract settlement, with overall market transactions being sluggish. Additionally, aluminum futures prices surged at the opening, and suppliers offered lower prices with weak willingness to hold prices firm. Ultimately, the actual transaction price range in the central China market was between a premium of 20 yuan and a discount of 30 yuan to the central China price. Today, the central China market shipments sentiment index was 2.84, flat MoM; the purchasing sentiment index was 2.26, down 0.02 MoM.

Inventory side, today the aluminum ingot inventory in major consumption areas rose 9,500 mt MoM, with the inventory buildup mainly originating from Guangdong and Wuxi.