Aluminum Prices Slump, Downstream Purchasing Sentiment Recovers [SMM Spot Aluminum Midday Comment]

SMM, June 16:

The SHFE aluminum price center in the morning session was far below the same period yesterday. However, affected by the sharp decline in aluminum prices, buyer purchasing sentiment surged, driving seller quotes and transaction prices to strengthen continuously. Some sellers, influenced by the aluminum prices, held back from selling and raised their quotes. The mainstream spot transaction prices were at a discount of 80 to a discount of 90 yuan/mt against the SHFE aluminum July contract. Today, the shipment sentiment index in East China was 2.83, down 0.13 MoM; the purchasing sentiment index was 3.06, up 0.30 MoM.

SHFE aluminum futures prices plunged in the night session of the previous day and the morning session today. In the central China market, the buying sentiment of downstream processing enterprises recovered, and their willingness to stockpile increased. Trading firms engaging in both spot and futures markets tended to quickly earn price spreads, and the sentiment of holding prices firm and holding back from selling was strong, keeping market quotes high. Ultimately, the actual transaction price range in the central China market was at a discount of 120-140 yuan/mt against the SHFE aluminum July contract. Today, the shipment sentiment index in the central China market was 2.91, down 0.01 MoM; the purchasing sentiment index was 2.22, up 0.02 MoM.

On the inventory front, the aluminum ingot inventory in major consumption areas fell 0.25 MoM today, with destocking mainly driven by Guangdong and Wuxi.