South China Aluminum: Bargain Hunting Pushes Prices up

SHANGHAI, Nov. 2 (SMM) – Most active SHFE aluminum contract prices opened lower at RMB 16,000/mt on Wednesday, but later moved up steadily to recover early losses. Despite series of negative news on European debt issues, continuous losses in recent days strengthened market expectations that SHFE aluminum prices might stop falling at RMB 16,000/mt mark, and prices may rebound briefly. Cargo holders in South China were reluctant to sell goods today, while downstream buying interest improved slightly for eased financial pressure. Coupled with high purchasing interest by middlemen at low prices, the local market saw supply unavailability from the original slight supply surplus, which push aluminum prices up, with mainstream transactions done at RMB 16,230-16,290/mt. Spot premiums over prices in Shanghai expanded to RMB 60/mt. Overall trading sentiment improved slightly.