SMM Aluminum Market Morning Comment (Aug 15)

Market: The most-traded SHFE aluminum 2409 contract opened at 19,095 yuan/mt overnight, with a high of 19,160 yuan/mt, a low of 19,030 yuan/mt, and closed at 19,055 yuan/mt, up 15 yuan/mt, or 0.08%. On Wednesday, LME 3M aluminum opened at $2,332.5/mt, with a high of $2,365/mt, a low of $2,319/mt, and closed at $2,327/mt, up $1/mt, or 0.04%.

Summary: On the macro front, the US July CPI data was released overnight, showing that core goods were the main factor driving overall inflation down, while the energy sub-index rebounded. After the data release, the market leaned towards pricing in a weakening economy, leading to a pullback in rate cut expectations, and non-ferrous metals prices surged and then fell back. Fundamentally, domestic aluminum operating capacity gradually stabilized, with supply side peaking. Cost side, the alumina market prices are fluctuating at high levels, providing strong support for aluminum costs. This week, downstream aluminum consumption shows signs of stabilizing and recovering, with social inventory showing a slight destocking, indicating positive signals. SMM expects aluminum prices to bottom out. Future attention should be paid to macroeconomic guidance from US employment and other economic data, as well as changes in aluminum consumption.