SHANGHAI, Jul. 12 (SMM) – The most active SHFE aluminum contract for October delivery started slightly lower at RMB 15,500/mt and hit a high of only RMB 15,545/mt following a narrow struggle centering the 10-day moving average. Losses expanded in the afternoon as the contract fell back to an even lower RMB 15,460/mt. The closing price was RMB 15,505/mt, down RMB 75/mt or 0.48%. Positions dropped a slight 100 lots to 109,960 lots. Transacted contracts fell below 18,000 lots as trading turns quiet. The contract should struggle near RMB 15,500/mt for the near term due to cautious trading.
Spot aluminum prices were RMB 15,530-15,560/mt in Shanghai, at discounts of RMB 50-80/mt over the current-month SHFE aluminum contract. Low-iron aluminum sold at RMB 15,620-15,640/mt. Spot discounts failed to narrow despite nearing of the delivery date, due to soft SHFE aluminum prices, weak demand and pressure from cheaper imported aluminum ingots which sold at as low as RMB 15,500-15,520/mt. Bearishness was strong among both sellers and buyers, with extremely light trading despite price cuts. Spot aluminum trading was even quieter in the afternoon, with only sparse quotations at RMB 15,520-15,530/mt seen. Deals were rarely concluded lacking purchases.