SHANGHAI, Apr. 19 (SMM) – Plunging LME and SHFE copper prices caused SHFE 1306 aluminum contract to open lower at RMB 14,500/mt on Thursday. The most active SHFE aluminum contract dived further to RMB 14,220/mt shortly after its opening, but later did bounce back to RMB 14,400/mt on short-covering. Finally, SHFE aluminum for June delivery closed at RMB 14,525/mt, down RMB 35/mt or 0.24%. Positions decreased 2,282 lots to 70,044 lots. The light metal dropped on bearish sentiment, but proved resilient to declines due to cost support. The most-traded SHFE aluminum contract should struggle at RMB 14,500/mt in the near term.
Spot aluminum was traded at RMB 14,370-14,400/mt in Shanghai on Thursday, a discount of RMB 70-100/mt over SHFE 1304 aluminum contract. Low-iron aluminum was traded around RMB 14,550/mt. SHFE aluminum dropped along with tumbling copper prices. Some traders in spot market held back goods, but most remained eager to sell at discounts of RMB 100/mt. Downstream producers purchased to need, and middlemen became less interested in low-priced goods, preventing mainstream traded prices from climbing above RMB 14,400/mt. In the afternoon, SHFE 1306 aluminum contract narrowed losses, pushing spot aluminum offers up to RMB 14,400/mt from RMB 14,360/mt. Overall trading was muted.