Reduction In Aluminum Billet Inventory In China Accelerated

This week saw a continued decrease in aluminum prices. The increase in processing fees was less than the decrease in aluminum prices, which encouraged downstream factories to actively stock up billets at lower prices. In addition, a major group in the northern region cut production of aluminum billets, easing supply-side pressure at the start of December. As a result, the reduction in aluminum billet inventory accelerated this week. As of December 7, 2023, SMM reports that domestic aluminum billet inventory at 85,600 mt, down 8,600 mt since Monday and 7,800 mt WoW. Compared to the same period last year, which was 71,600 mt, the inventory difference has narrowed to 14,000 mt but stocks remain high relative to the same period in the past three years. Despite fluctuations in the reduction of social inventory of aluminum billets since the turning point, the overall decline remains fast. SMM predicts that, with further easing of supply-side pressure on aluminum billets in December, the inventory levels could continue a weak downward trend towards the year-end.