Hedging positions showed high enthusiasm for selling, with spot premiums rising first and then falling during the day. [SMM Spot Aluminum Midday Review]

In the early session, aluminum prices fluctuated rangebound around 20,450 yuan/mt, and rose again to around 20,550 yuan/mt in the second session. In the spot market, downstream in east China maintained just-in-time procurement, and the market was still impacted by low-priced cargo and hedging warrants, with transactions mainly at parity with SMM A00. SMM A00 was on par with the SHFE aluminum 2504 contract, unchanged from the previous trading day. SMM A00 aluminum ingot prices were recorded at 20,560 yuan/mt, unchanged from the previous trading day.

In the central China market, after aluminum prices fell sharply, downstream restocking increased, and SHFE aluminum shifted to a backwardation structure. With the spot-futures price spread widening, suppliers were more active in selling, and the market dropped from a premium of 20 yuan/mt against central China to near parity. SMM central China A00 was recorded at 20,490 yuan/mt against the SHFE aluminum 2504 contract, unchanged from the previous trading day. The Henan-Shanghai price spread was -70 yuan/mt, with actual transactions at parity to a premium of 10 yuan/mt against SMM central China prices, and -70 yuan/mt against the 2504 contract.

In terms of inventory, SMM's daily aluminum social inventory was recorded at 662,400 mt, a decrease of 0.8 mt. After the center of aluminum prices shifted downward, downstream restocking will increase. Once the finished product inventories of downstream processing materials are digested to normal levels, inventories across the country will accelerate destocking, and market premiums and discounts will rise.

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