8.11 SMM Cast Aluminum Alloy Morning Comment
Futures: Overnight, the most-traded AD2610 aluminum alloy contract opened at 23,560 yuan/mt, hit a high of 23,590 yuan/mt, a low of 23,495 yuan/mt, and closed at 23,560 yuan/mt, up 65 yuan/mt or 0.28%. The price traded above all moving averages, with the mid-term bullish trend intact. Trading volume totaled 3,335 lots, shrinking noticeably from the previous period, suggesting that after short-term bulls pushed prices higher, willingness to add positions weakened. Open interest rose by 230 lots to 19,187 lots, a modest uptick in both open interest and prices, indicating some new long money entered but no large-scale turnover between longs and shorts.
Spot-Futures Spread Daily: According to SMM data, on August 10, the SMM ADC12 spot price carried a theoretical premium of 740 yuan/mt over the 10:15 a.m. closing price of the most-traded AD2610 cast aluminum alloy contract.
Warrant Daily: SHFE data showed that on August 10, total registered warrants for cast aluminum alloy stood at 17,315 mt, up 30 mt from the previous trading day. By region, Shanghai registered 1,506 mt, unchanged; Guangdong 1,312 mt, down 30 mt; Jiangsu 3,806 mt, unchanged; Zhejiang 7,082 mt, up 90 mt; Chongqing 2,824 mt, down 30 mt; and Sichuan 785 mt, unchanged.
Aluminum Scrap: Yesterday, the SMM A00 spot aluminum price closed at 23,990 yuan/mt, up 10 yuan/mt from the previous trading day. Domestic aluminum scrap market prices were largely steady with a wait-and-see attitude, except for baled UBC which caught up with the rally and surged 100 yuan/mt in a single day. Regarding price spreads, on August 10, the price difference between A00 aluminum and mixed aluminum extrusion scrap free of paint in Foshan was approximately 2,370 yuan/mt, and the price difference between A00 aluminum and shredded aluminum tense scrap was about 1,160 yuan/mt. As primary aluminum prices continued to climb, aluminum scrap lacked momentum to follow suit, causing these spreads to widen again. This week, the priced based on aluminum content for shredded aluminum tense scrap is expected to be weighed down by stagnant raw material prices and sluggish downstream demand, trading under pressure, with the mainstream trading range likely to revolve around 20,200-20,800 yuan/mt.
Silicon Metal: On August 10, SMM non-oxygen blown #553 silicon prices in east China were stable; oxygen-blown #553 silicon prices were raised; #521, #441, #421, #421 for silicone, and #3303 prices were all stable. In Tianjin, some silicon prices were raised. Prices remained stable in south China, Kunming, Huangpu Port, Shanghai, Xinjiang, northwest China, and other regions.
Markets Outside China: On the import front, overseas ADC12 offers edged up to $3,070-3,190/mt, and immediate import losses widened to around 905 yuan/mt.
Summary: Yesterday, ADC12 market offers were largely stable, with the industry generally reluctant to adjust prices. Recently, futures strengthened, and arbitrage traders' inquiry activity picked up somewhat. However, constrained by weak end-use demand, spot transaction volumes were limited, providing little substantial support for price gains. Meanwhile, the cost side continued to provide bottom support, leaving prices under pressure from both ends and keeping the market overall in a wait-and-see mode. ADC12 prices are expected to remain stable with consolidation in the near term.
[Data Source Statement: Except for publicly available information, other data are derived from open information, market communication, and SMM's internal database models, processed by SMM, and are for reference only, not constituting investment advice.]
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