SHANGHAI, Sept. 1 (SMM) – As LME aluminum prices surged 2% overnight, most active SHFE 1111 aluminum contract opened higher at RMB 17,510/mt on August 31st in response. The contract hit an intraday high of RMB 17,525/mt in the morning, but soon fluctuated downward to a lowest RMB 17,420/mt during the day as a result of profit-taking. The contract finally closed at RMB 17,475/mt, up RMB 35/mt or 0.20% after narrowly fluctuating near RMB 17,450/mt. While the contract stagnated due to a lack of capital support, transactions during the day also dropped to less than 30,000 lots with low investor confidence. SMM expects the contract to test RMB 17,500/mt in the short term.

Trading prices of spot aluminum in Shanghai were between RMB 17,790-17,830/mt on August 31st, with premiums of RMB 90-120/mt over SHFE current-month aluminum prices. Due to tight capital supply among both suppliers and buyers on the last day of August, lower spot quotes were rarely seen despite excessive supply, and spot aluminum prices in Wuxi was pushed to the same levels in Shanghai. Market transactions were sparse. Spot quotes slightly rose to RMB 17,800-17,820/mt in the afternoon after SHFE current-month aluminum prices gained. After financial settlements, goods holders were in no need of active selling, while purchasers on the other hand lacked capital to buy, with no market transactions reported.