SHANGHAI, Jun. 19 (SMM) – LME aluminum inventories surged 69,000 mt to 5.35 million mt last night, a new record high. Mounting inventories fuelled concerns over tepid demand. Investors pulled out of the market ahead of the result of US Federal Reserve policy meeting, causing LME aluminum positions to tumble 22,439 lots to 742,606 lots. LME aluminum found its low at USD 1,832/mt during the European trading session, but recouped some losses at the tail of the session before finally closing down 0.50% at USD 1,841/mt, down for eight days in a row.
Aluminum prices will remain low due to worries over growing supply, with LME aluminum meeting resistance at USD 1,850/mt and moving within USD 1,820-1,850/mt on Wednesday. SHFE 1310 aluminum contract is expected to open lower at RMB 14,500/mt, with prices between RMB 14,450-14,550/mt. In spot market, traders will be anxious to sell, but downstream producers will purchase only on an as-needed basis, with spot premium of RMB 0-40/mt expected over SHFE 1307 aluminum contract prices.