SHANGHAI, Mar. 5 (SMM) – Russia-Ukraine tensions eased on Tuesday after Russian President Putin ordered troops involved in a military exercise in western Russia to return to base. In this scenario, LME aluminum recovered earlier losses after opening at USD 1,722/mt, and closed Tuesday USD 48.8/mt or 2.83% higher at USD 1,770/mt. Trading volumes contracted 1,097 lots to 18,874 lots, while positions added 8,762 lots to 795,468 lots.
SHFE 1405 aluminum contract crept up to RMB 13,340/mt after starting Tuesday’s night session at RMB 13,265/mt, and ended at RMB 13,330/mt. 8,504 lots were traded during the night hours, and positions added 648 lots to 95,860 lots.
Despite the lessening of tensions, uncertainty over the Ukraine issue remains. This may drive investors to take profits at highs, keeping the most active SHFE aluminum contract in check within RMB 13,280-13,380/mt on Wednesday. In China’s physical market, rally in SHFE aluminum will fuel buying among traders and downstream producers, helping spot discounts over SHFE 1403 aluminum contract prices to narrow to RMB 160-200/mt.