Falling Aluminum Prices, Combined with the Impact of Pre-Holiday Stockpiling, Boost Market Purchasing Sentiment [SMM Spot Aluminum Midday Review]

SMM June 18 News:

In early trading, the SHFE aluminum 2606 contract fluctuated, with its trading center lower than the same period yesterday. Affected by lower aluminum prices and pre-holiday stockpiling, buying sentiment remained relatively active today. Good destocking performance pushed sellers' quotes and transaction prices to strengthen continuously. Mainstream spot aluminum transaction prices were at a discount of 50-60 yuan/mt against the SHFE aluminum 07 contract. Mainstream spot aluminum transaction prices were at a discount of 60-80 yuan/mt against the SHFE aluminum 07 contract. In east China today, the shipment sentiment index was 2.91, flat MoM; the buying sentiment index was 3.2, up 0.14 MoM.

As today was the last day before the Dragon Boat Festival, downstream processing enterprises in the central China market showed strong buying sentiment, and overall transaction was relatively active, though actual transaction prices were relatively weak. Cargo-holding traders tended to sell large volumes before the holiday to avoid risks from price fluctuations during the holiday. Ultimately, actual transaction prices in the central China market were in the range of a discount of 70-100 yuan/mt against the SHFE aluminum 07 contract. In central China today, the shipment sentiment index was 2.93, up 0.01 MoM; the buying sentiment index was 2.23, up 0.02 MoM.

On the inventory front, aluminum ingot inventories in major consuming regions fell 1.75 MoM today, with all three regions showing destocking trends.