Spot transactions in east and central China were moderate and spot discounts may persist [SMM spot aluminum midday review]

In today's early trading, the most-traded SHFE aluminum contract fluctuated upward. Today, the holders in east China mainly shipped goods, and the overall transaction was average. According to SMM statistics, today the aluminum ingot inventory in Wuxi (excluding Hangzhou, Changzhou, Hai'an, etc.) was 282,300 tons, an increase of 8,900 tons from the previous trading day. Today, the SMM A00 aluminum price is at a discount of about 60 yuan/ton to the 2405 contract, unchanged from the previous trading day. The spot price was recorded at 20,540 yuan/ton. In the second trading session, the market prices went up. Today, the mainstream transactions in east China were at a discount of about 10 yuan/ton to a premium of about 10 yuan/ton to the SMMA00 aluminum price.

Today, spot transactions in central China were weak, with downstream purchases mainly driven by rigid demand. Spot discounts were widening. According to SMM statistics, the inventory of aluminum ingots in Gongyi was about 105,800 tons today, a decrease of 2,500 tons from the previous trading day. Today, the SMM central China price was at a discount of about 150 yuan/ton to the 2405 contract, a decrease of 20 yuan/ton from the previous trading day. The average spot price is 20,450 yuan/ton. The mainstream spot transactions are at a discount of 10 yuan/ton to a premium of about 10 yuan/ton to the SMM central China price in the early trading.

Overall, according to SMM data, the inventory of aluminum was 794,000 tons on Monday. After the Labour Day holiday, the inventory of aluminum ingots increased slightly by 3,000 tons compared with last Monday. On the supply side, the import window of primary aluminum remained closed, while the domestic supply of aluminum maintained a growth trend. On the demand side, the downstream operating rate remained stable, and the overall domestic supply and demand contradiction was not large. However, high aluminum price suppressed the downstream sentiment, and the spot market may maintain a discount in the short term. We need to pay attention to the inventory of aluminum ingots after the Labour Day holiday.