SMM Aluminum Market Morning Comment (Mar 25)

At last Friday’s night session, the most-traded SHFE 2405 aluminum contract opened at 19,445 yuan/mt, with its lowest and highest at 19,400 yuan/mt and 19,595 yuan/mt before closing at 19,510 yuan/mt, up 110 yuan/mt or 0.57%. LME aluminum opened at $2,310/mt in the previous trading day, with its high and low at $2,312.5/mt and $2,281/mt respectively before closing at $2,309/mt, unchanged from the previous trading day.

Summary: On the macro front, the conflict between Russia and Ukraine drove up the gold prices and brought great uncertainty to the future situation. Fundamentally, imports of primary aluminum are still at a high level, and the drought in Yunnan will not disturb aluminum production resumption in the short term. The arrival of the traditional peak season boosted downstream operating rate. Last Thursday, the total inventory of aluminum ingots and billets dropped. Boosted by positive fundamentals and macro front, aluminum prices may swing on a strong note.