SHANGHAI, Feb. 1 (SMM) – SHFE 1304 aluminum contract prices opened slightly higher at RMB 15,260/mt on January 31. The most active aluminum contract pared some gains and dipped to RMB 15,225/mt as longs and shorts exited the market. The three-month aluminum contract did rebound at the tail of trading, but upside space was extremely limited. Finally, the April aluminum closed RMB 50/mt or 0.33% higher at RMB 15,250/mt. Positions were down 1,600 lots to 52,066 lots. All base metals on the SHFE except aluminum shot up along with rising LME aluminum prices. The most-traded SHFE aluminum is not expected to break though RMB 15,300/mt in the short term.

Spot aluminum was mainly traded at RMB 14,920-14,940/mt in Shanghai on Thursday, with discounts at RMB 80-100/mt. Low-iron aluminum was traded at RMB 15,020-15,030/mt. SHFE 1304 aluminum contract prices were stagnant after opening slightly higher, failing to boost market confidence. Downstream producers have almost completed restocking for the upcoming Chinese New Year. Some cargo holders remained aggressive in selling off inventories. Only a limited number of traders entered the market. Cargo holders lowered offers amid subdued trading activities, curbing gains of spot aluminum prices. In the afternoon, trading activity in spot markets was even quieter, with sparse offers reported at RMB 14,940/mt. Most downstream producers have closed early for the Chinese New Year, while traders will also begin to take a break early next week.