Market trading sentiment was relatively mediocre, and procurement enthusiasm was low [SMM Spot Aluminum Midday Review]

SMM, July 27:

In early trading, the center of the SHFE aluminum 2606 contract was slightly higher than the same period of the previous trading day. Affected by weak end-use demand, overall market purchases today remained mainly for essential stockpiling. Given that market supply was still ample, price acceptance stayed weak. The mainstream transaction price for cargoes with invoices dated this month was mostly on par with the SHFE aluminum 08 contract. In east China today, the selling sentiment index was 3.13, flat MoM; the buying sentiment index was 2.94, flat MoM.

The trading sentiment in the central China market was relatively mediocre today. Monday was also the first day of next-month invoicing, downstream processing enterprises showed limited buying sentiment, with only a few enterprises making small purchases for essential needs. Meanwhile, suppliers showed weak willingness to hold prices firm, and quotes trended lower. At the same time, trading of current-month invoices was rather active, with traders short of invoices completing large transactions for current-month cargoes. However, against the backdrop of an overall invoice shortage in the market, quoted prices stayed high. Eventually, the actual transaction price range for next-month invoices in central China centered around a discount of 100-120 yuan/mt against the SHFE aluminum 08 contract. In central China today, the selling sentiment index was 3.10, flat MoM; the buying sentiment index was 2.90, down 0.05 MoM.

Inventory-wise, aluminum ingot inventory in major consumption areas fell 14,000 mt MoM today, with all three regions showing destocking.