8.1 SMM Cast Aluminum Alloy Morning Comment
Futures: Overnight, the most-traded aluminum alloy 2609 contract opened at 23,510 yuan/mt, peaked at 23,595 yuan/mt, bottomed at 23,445 yuan/mt, and closed at 23,460 yuan/mt, up 75 yuan/mt, or 0.32%. Prices remained above all major moving averages, with the medium-term bullish trend structure intact. However, significant selling pressure emerged at higher levels, and short-term upward momentum waned. Trading volume was 3,443 lots, down 1,663 lots from the previous session, shrinking notably; open interest stood at 18,687 lots, up 198 lots from the previous session, a slight increase.
Spot-Futures Price Spread Daily: According to SMM data, on August 7, SMM ADC12 spot price was theoretically at a premium of 740 yuan/mt to the closing price of the most-traded cast aluminum alloy contract (AD2609) at 10:15 a.m.
Warrant Daily: SHFE data showed that on August 7, total registered warrants for cast aluminum alloy stood at 17,285 mt, up 1 mt from the previous trading day. By region, Shanghai held 1,506 mt, unchanged; Guangdong held 1,342 mt, unchanged; Jiangsu held 3,806 mt, unchanged; Zhejiang held 6,992 mt, up 31 mt; Chongqing held 2,854 mt, down 30 mt; Sichuan held 785 mt, unchanged.
Aluminum Scrap: Last Friday, SMM A00 spot aluminum closed at 23,980 yuan/mt, up another 180 yuan/mt from the previous trading day. Domestic aluminum scrap market prices were mostly steady with a wait-and-see attitude, with only some grades in parts of east China edging up. In terms of price spreads, as of August 7, the price difference between A00 aluminum and mixed aluminum extrusion scrap free of paint in Foshan was about 2,310 yuan/mt, and that between A00 aluminum and shredded aluminum tense scrap was about 1,110 yuan/mt. As primary aluminum prices continued to rise, aluminum scrap lacked upward momentum, widening these spreads again. This week, shredded aluminum tense scrap priced on aluminum content is expected to be under pressure, weighed down by stagnant raw material prices and weak downstream demand. The mainstream trading range is likely to center around 20,200-20,800 yuan/mt.
Silicon Metal: On August 7, SMM non-oxygen blown #553 in east China was stable; oxygen-blown #553 was raised; #521, #441, #421, #421 for silicone use, and #3303 were all stable. In regions such as south China, Guangdong, Huangpu Port, and Tianjin, some silicon prices were raised. In Kunming, Shanghai, Xinjiang, and north-west China, silicon prices held steady.
Markets Outside China: On the import front, overseas ADC12 offers were at $3,050-3,190/mt, with immediate import losses holding steady at about 827 yuan/mt.
Summary: Last Friday, ADC12 market quotes mostly consolidated on a strong note, with SMM ADC12 price edging up 50 yuan/mt. Primary aluminum prices continued to provide cost support, and producers remained willing to hold prices firm. However, end-use demand stayed weak, downstream procurement pace was cautious, and improvement in market transactions was limited. Downward adjustment momentum is insufficient, while upward pass-through is also constrained by demand. In the short term, the ADC12 market is expected to keep consolidating amid coexisting cost support and demand resistance.
[Data Source Disclaimer: All data other than publicly available information are processed by SMM based on public information, market communication, and proprietary database models. They are for reference only and do not constitute any recommendation or advice for decision-making.]
