SHANGHAI, Apr. 8 (SMM) – Last week, the difference in PMI readings for March between China’s official figure and that released by HSBC caused SHFE 1406 aluminum contract prices to rise less than the previous week, with prices fluctuating between the 5-day and 30-day moving averages for most of last week. Prices for the most active contract moved lower last Thursday after a high opening, dampening market sentiment and prompting investors to close positions. In China’s physical markets, cargo holders held back goods at lower prices and traders were actively buying, pushing prices up. However, the decline in SHFE aluminum prices in the second half of the week turned buyers cautious and left suppliers anxious to sell.
This coming week, prices for the most active SHFE aluminum contracts should move in a RMB 13,000-13,300/mt range due to profit taking at highs. In China’s spot markets, market fundamentals remain poor. Should SHFE aluminum prices move lower, spot aluminum prices will follow, with spot discounts of RMB 100-200/mt expected over SHFE 1404 aluminum contract prices.