SHANGHAI, Dec. 2 (SMM) – Despite growing profits at Chinese industrial enterprises in October, SHFE 1402 aluminum contract prices still fell to a three-year low of RMB 13,975/mt after falling LME aluminum prices triggered panic selling. Short sellers entered the market due to falling SHFE aluminum prices, with trading volumes of the most active SHFE aluminum contracts up 13,668 lots to 40,858 lots, and positions up 12,472 lots to 59,536 lots. In China’s spot markets, falling SHFE aluminum prices also dragged down spot aluminum prices, making traders more anxious to sell. Consumption by large downstream producers remained stable, but purchases by smaller producers fell sharply. Most producers were pushing for lower input costs, so most deals were done at the lower end of the price range.
In the coming week, LME aluminum prices will move in a USD 1,700-1,750/mt band and SHFE 1402 aluminum contract prices will fluctuate between RMB 13,950-14,050/mt. In China’s spot markets, premiums of RMB 50/mt are expected over SHFE 1312 aluminum contracts.