Year-End Control of Two Funds Highlights Regional Premium and Discount Differences [SMM Spot Aluminum Midday Review]

This morning, SHFE aluminum stabilized and rebounded before consolidating around 19,950 yuan/mt. After 10 a.m., the futures market turned downward, breaking below 19,900 yuan/mt. In east China, most major traders continued to clear inventory under the year-end cash and inventory control, and despite the rebound in downstream restocking sentiment amid the price pullback, the trend of declining premiums and discounts persisted. Today, the SMM A00 spot price was at a discount of 110 yuan/mt against the SHFE aluminum 2501 contract, down 20 yuan/mt from the previous trading day. SMM A00 aluminum ingot prices stood at 19,790 yuan/mt, down 110 yuan/mt from the previous trading day.

In the central China market, downstream buyers restocked on dips, and market trading sentiment was positive. Traders stood firm on quotes, narrowing the Henan-Shanghai price spread to a discount of around 100 yuan/mt. SMM Central China A00 aluminum ingot prices were recorded at 19,690 yuan/mt against the SHFE aluminum 2501 contract, down 210 yuan/mt from the previous trading day, with actual market transactions at a premium of around 10-20 yuan/mt against SMM Central China prices.

Inventory-wise, according to SMM's daily inventory statistics, destocking in major consumption regions reached 12,400 mt. After aluminum prices fell below the 20,000 yuan/mt threshold, downstream buyers restocked on dips, leading to a rebound in premiums across regions except for east China. As of now, with the final invoicing month of 2024 not yet concluded, the market still faces inventory clearance and cash recovery pressures, and premiums in east China may remain weak.

Source: SMM

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