Aluminium ingot inventory growth slowed down in March

On Mar 14, 2024, SMM data showed that the social inventory of aluminum ingots in China’s eight major markets was 843,000 mt, (the amount for sale stood at 717,000 mt), up 22,000 mt WoW, up 3,000 mt from Mar 11, and 352,000 mt higher than pre-CNY holiday level, remaining at the lowest compared to the same period of past seven years. The inventory growth slowed down and future growth will be limited. The current inventory is close to the peak of 850,000 mt predicted pre-holiday. The outflows of aluminum ingots from warehouses in the third week after CNY was 115,900 mt, up 17,100 mt WoW. The inventory of the three places diverged over the weekend, but remaining stable in the middle of the week. Wuxi has seen concentrated arrivals on weekends, up 22,000 mt WoW, of which the inflows into warehouse was as high as 34,000 mt, almost doubling WoW. According to SMM research, the main reason for this concentrated arrivals is that smelters, mostly those in Xinjiang, are digesting their backlog inventory. However, the sustainability is very limited, and it is expected that the arrivals will fall significantly. The inventory declined by 3,000 mt in Wuxi in the middle of the week. Inventories in Foshan was up 10,000 mt. The inflow into and outflow from warehouses were consistent WoW, but inflow into warehouses rose slightly in the middle of the week. The inventory performance in Gongyi was the most eye-catching among the three places, down by 9,000 mt WoW, and the inventory showed signs of declining; at the same time, the outflow from warehouses increased by 9,500 mt. In addition to the decrease in arrivals, the gradual increase in outflow from warehouses is boosted by the improvement in local downstream operating rates and the increase in demand for raw materials. However, the outflow from warehouses stagnated in the middle of the week.