SHANGHAI, Apr. 27 (SMM) – SHFE 1307 aluminum contract started slightly higher at RMB 14,665/mt on Friday. The most active SHFE aluminum contract broke through RMB 14,700/mt in the morning before immediately falling back. Longs and shorts exited the market, leading to sharp declines in SHFE 1307 aluminum contracts. As a result, SHFE 1306 aluminum contract became the most active one again, which finally closed at RMB 14,630/mt, up RMB 25/mt or 0.17%. Positions decreased 1,890 lots to 56,358 lots. Investors closed positions before the three-day public holiday to avoid risks. The most active SHFE aluminum contract should remain stable at RMB 14,600/mt next week if LME aluminum is little changed during the holiday.
Spot aluminum was traded at RMB 14,520-14,530/mt in Shanghai on Friday, a discount of RMB 80-90/mt over SHFE 1305 aluminum contract. Low-iron aluminum was traded around RMB 14,680/mt. SHFE 1305 aluminum contract climbed above RMB 14,600/mt, boosting market sentiment. Downstream producers increased purchases on the last trading day before the Chinese May Day holiday. Prices in Guangdong were nearly RMB 200/mt higher than in Shanghai, enticing some middlemen to buy goods in Shanghai and then sell them in Guangdong. In this context, traders held offers firm at RMB 14,520/mt. Aluminum ingot offered at RMB 14,510/mt was quickly sold out, but trading was down when price rose to RMB 14,530/mt. Overall trading was brisk. In the afternoon, the most active SHFE aluminum contract pared some gains, but SHFE 1305 aluminum contract remained stagnant at RMB 14,600/mt. Sparse offers were reported at RMB 14,520-14,530/mt in spot market, but trading was muted. Spot aluminum market will remain quiet today and tomorrow as SHFE market is closed for the holiday.