SHFE Aluminum Futures Decline, Central China Sees Increased Downstream Buying Interest

[Geopolitical Disturbances Marginally Weaken, Accelerating Destocking Supports Aluminum Prices Fluctuating Upward] On the macro front, Trump once again claimed that US-Iran negotiations have entered the "final moment," but the market has become desensitized to his repeated similar statements, and the geopolitical risk premium is marginally weakening. On the fundamentals side, the supply gap outside China is expected to provide strong bottom support for aluminum prices, and expectations of rising energy costs also form a bullish driver for aluminum prices; however, the high inventory pressure in China remains relatively evident, which is expected to limit the upside room for China's aluminum prices, and in the short term, China’s aluminum prices are expected to mainly fluctuate and adjust.

[SMM Central China Spot Aluminum Midday Review] SHFE aluminum futures prices continued to decline compared to yesterday's early session, with a relatively narrow spot-futures spread. Traders in the central China market took the opportunity to hold prices firm, maintaining high discounts and shipping large volumes, while market trading sentiment edged up from yesterday. The actual transaction price range in the central China market was around a discount of 100-130 yuan/mt against the SHFE aluminum June contract.

[SMM Flash] SHFE data showed that on June 9, the total registered warrants for cast aluminum alloy stood at 38,866 mt, a decrease of 448 mt from the previous trading day. Among them, the registered quantity in Shanghai was 2,897 mt, unchanged from the previous trading day; Guangdong 8,801 mt, down 514 mt; Jiangsu 7,560 mt, down 59 mt; Zhejiang 12,666 mt, up 185 mt; Chongqing 5,947 mt, down 60 mt; and Sichuan 995 mt, unchanged.