[minutes of internal morning meeting of SMM aluminum] the inflection point of electrolytic aluminum social inventory appears at first, what is the follow-up trend of aluminum price?

7.12 minutes of SMM internal aluminum morning meeting

Market surface: yesterday, London Aluminum touched $1850.5 / ton after shock down, closing at $1821 / ton, down $29 / ton, down 1.57%. The Japanese K line closed at $29 / ton, giving back more than half of its previous day's gains to short positions. Shanghai Aluminium main Company 1908 contract closed at 13760 yuan / ton.

Macro: on the data side, the public value of the core CPI adjusted in June was 256.14, compared with the previous value of 256.09, an unexpected jump, an increase of 0.3% from the previous month, the largest increase in a year and a half; Fed Chairman Powell once again released a strong interest rate cut in his testimony at a hearing on Wednesday, suggesting that a number of members of the Federal Open Market Committee (FOMC) believe that looser monetary policy needs to be considered.

Fundamentals: (1) in terms of industry policy, the Guizhou Provincial Development and Reform Commission has issued the detailed rules for the implementation of the negative list for the Development of the Yangtze River Economic Belt in Guizhou Province (draft for soliciting opinions). The document forbids electrolytic aluminum and other industries to illegally increase production capacity projects; Henan Ecological Environment Department issued the "Aluminum Industry Pollutant discharge Standard" (draft for soliciting opinions). (2) overseas, the Mostar electrolytic aluminum plant in Bosnia, with an annual capacity of 130000 tons, has recently been shut down due to debt pressure; companies such as Glencore have expressed interest in buying Rio Tinto's aluminum plants in Iceland, Sweden and the Netherlands for as much as US $350 million. (3) inventory, July 11 SMM statistics domestic electrolytic aluminum social inventory 1.042 million tons, month-on-month increase of 14000 tons compared with last Thursday, except Shanghai and Wuxi area, South China Sea, Hangzhou, Gongyi, Linyi, Tianjin, Chongqing inventory month-on-month increase, inventory inflection point.

Spot: on Thursday, the trading price between Shanghai and Wuxi was between 13790 and 13800 yuan / ton, 10 yuan / ton for the current month, and 13800 to 13820 yuan / ton after 10: 30. the spot price for the current month was flat-up 20 yuan / ton, up more than 70 yuan / ton over the previous price, and Hangzhou spot price was between 13820 and 13840 yuan / ton. Due to the recovery of the macro atmosphere overnight, the aluminum price rose sharply, while the rising sticker water did not change significantly. The spot price was significantly higher than that on Wednesday. At high prices, the shippers shipped actively, and some of them were active in receiving the goods. The middlemen traded actively, coupled with the fact that a large market received more than 6,000 tons of goods, and the market transaction was OK. But downstream fear of high sentiment is obvious, Thursday to receive goods in general, mainly on-demand procurement.

Summary: the recent Shanghai-London aluminum plate in the face of macro positive signal digestion is more rapid, electrolytic aluminum off-season began to accumulate, consumption off-season has arrived, and the cost end is still going down the channel, so we maintain the short-term aluminum price pressure point of view, but based on the expectation of the consumption peak season in September, it is suggested that the layout of 13500 to 13800 yuan per ton should be tried.

(SMM Li Hao 021 5166 6863)