8.14 SMM Cast Aluminum Alloy Morning Comment
Futures: Overnight, the most-traded 2610 aluminum alloy contract opened at 23,385 yuan/mt, hit a high of 23,430 yuan/mt and a low of 23,185 yuan/mt, and closed at 23,245 yuan/mt, down 150, a decline of 0.64%. Trading volume was 4,851 lots, down 502 lots from the previous session; during the decline phase, volume pulled back relative to the previous bearish candlestick. Open interest was 18,916 lots, down 543 lots, and continued to decline markedly.
Spot-futures price spread daily: According to SMM data, on August 13, the SMM ADC12 spot price was at a theoretical premium of 760 yuan/mt over the 10:15 closing price of the most-traded cast aluminum alloy contract (AD2610).
Warrant daily: SHFE data show that on August 13, total registered cast aluminum alloy warrants were 18,311 mt, up 333 mt from the previous trading day. Among these, total registered warrants by region: Shanghai 1,506 mt, down 0 mt from the previous trading day; Guangdong 1,312 mt, down 0 mt; Jiangsu 4,376 mt, down 0 mt; Zhejiang 7,568 mt, up 333 mt; Chongqing 2,764 mt, down 0 mt; and Sichuan 785 mt, down 0 mt.
Aluminum scrap: Yesterday, the SMM A00 spot aluminum price closed at 24,120 yuan/mt, down 250 yuan/mt from the previous trading day, and the domestic aluminum scrap market generally followed the decline. Next week, shredded aluminum tense scrap prices based on aluminum content are expected to be dragged by stagnant raw material prices and weak downstream demand, remaining under pressure overall, with the mainstream trading range expected to center around 20,200-20,800 yuan/mt.
Silicon metal: Yesterday, SMM oxygen-blown #553 silicon in east China was at 9,100-9,200 yuan/mt, with the price center edging up slightly WoW. The supply contraction caused by production cuts at silicon enterprises in early August and bullish price drivers from PV policy have already been partly realized, and silicon metal futures shifted to narrow sideways consolidation after the price increase. Fundamentals have improved, prices have relatively strong support on the downside, and downside room is limited. Upward momentum is insufficient, making a trending rally unlikely; the tug-of-war between longs and shorts has shifted prices into consolidation.
Markets outside China: On the import side, overseas ADC12 offers have pulled back slightly to $3,090-3,120/mt, a smaller decline than in China, causing immediate import losses to widen again to around 1,000 yuan.
Summary: Yesterday, aluminum alloy market offers were mostly lower, with SMM ADC12 prices cut by 200 yuan/mt. The pullback in futures further dampened spot market sentiment, and enterprises generally followed by lowering their offers. Downstream demand remains in the off-season, and some enterprises are still on high-temperature holidays or operating at reduced loads; end-user orders and procurement demand are weak, leaving the spot market without sustained upward momentum. However, the cost side still provides some support, as aluminum scrap prices remain relatively high overall, leaving limited room for enterprises to cut prices further. The market lacks demand-driven upside, while the downside is constrained by costs. ADC12 prices are expected to continue moving sideways in a range in the near term.
[Data source statement: Other than public information, all other data are processed by SMM based on public information, market communication, and SMM's internal database models. They are for reference only and do not constitute decision-making advice.]
