SHANGHAI, Jun. 28 (SMM) – SMM surveyed 44 Chinese aluminum smelters about their opinions over aluminum price outlook.

See SMM forecast, please click: LME Aluminum to Swing Wildly Next Week, SMM Expects  

About 55% of them expect SHFE 1608 aluminum to hold above RMB 12,300/mt and LME aluminum return to USD 1,630/mt. First, aluminum stocks in China’s five major markets fell 26,000 mt to 337,000 mt as of Monday. Second, longs are taking the upper hand. 

Another 27% expect SHFE 1608 aluminum to fluctuate at RMB 12,100-12,300/mt and LME aluminum move at USD 1,600-1,630/mt. First, UK leave vote may force the US Fed to delay interest rate hike process. Second, middle rate of Chinese yuan broke through 6.63 against US dollar on Monday, the lowest since 2011. This will trigger big volatility in base metals. Third, falling stocks in the market will allow aluminum smelters to hold back goods at lows.  

The 18% are bearish that SHFE 1608 aluminum will fall below RMB 12,100/mt and LME aluminum will drop below USD 1,600/mt. First, many aluminum processors said orders fell sharply due to onset of the off-season. Second, output release from new and restarted aluminum capacity will add to supply pressure.