SHANGHAI, Mar. 22 (SMM) – SHFE 1306 aluminum contract prices opened at RMB 14,690/mt on March 21. HSBC’s China preliminary March manufacturing PMI was upbeat, triggering short-covering and helping the most active SHFE aluminum contract hit a high of RMB 14,775/mt along with other base metals. In the afternoon, SHFE aluminum for June delivery inched down as longs were limited. Finally, the most-traded SHFE aluminum contract closed at RMB 14,730/mt, up RMB 45/mt or 0.31%. Positions were down 2,960 lots to 92,608 lots. Despite encouraging manufacturing PMI, demand remains tepid, eroding the upside space of the most active SHFE aluminum contracts, which should struggle at RMB 14,700/mt for the near term.
Spot aluminum was mainly traded at RMB 14,540-14,560/mt in Shanghai on Thursday, a discount of RMB 70-100/mt over SHFE current-month aluminum contract prices. Low-iron aluminum was trade around RMB 14,640/mt. SHFE 1306 aluminum contract prices extended gains due to upbeat preliminary March manufacturing PMI from China. Cargo holders were eager to move goods since they believe aluminum prices will not rise any further in the future. Middlemen went bargain-hunting, while downstream producers purchased only as needed, leaving mainstream traded prices stagnant at RMB 14,550/mt. Overall trading rebounded slightly. In the afternoon, the most active SHFE aluminum contract prices met resistance at the upper end, promoting traders to actively move goods, with offers at RMB 14,540-14,550/mt. Downstream producers and middlemen stood on the sidelines, leaving trading subdued.