[SMM analysis] the inventory ratio of aluminum ingots is on the low side and the spot price in Guangdong and Shanghai continues to hang upside down.

Published: Jul 23, 2020 20:42

Save

SMM, July 23:

Recently, spot prices in Guangdong and Shanghai continue to hang upside down, and there is no sign of a return in the short term. At the beginning of this month, the spot circulation in East China gradually tightened. Since July 8, the price difference between Guangdong and Shanghai has changed from positive to negative. During this period, the maximum spot transaction price difference between Guangdong and Shanghai is close to 300 yuan per ton. After the aluminum delivery and exchange month, the price difference between the two places has narrowed somewhat, but it has not changed the situation that the spot price of aluminum ingots in East China is higher than that in South China.

SMM announced today that the weekly inventory of domestic electrolytic aluminum is 6000 tons. Except for a slight increase in inventory in Shanghai, there is still no obvious trend of inventory accumulation in other areas. Among them, the inventory of aluminum ingots in East China (Shanghai, Wuxi and Hangzhou) is 425000 tons, and that in South China (South China Sea) is 174000 tons. The inventory ratio in East and South China is 2.44, which is much lower than the high value of 6.53 at the beginning of 2018 and slightly higher than the low value of 1.43 at the end of October 2019. The average inventory ratio since 2017 is 3.27, and the current ratio is on the low side. Inventories in southern China have increased by more than 20,000 tons since their low at the end of June, while inventories in eastern China have declined steadily over the same period. Most of the inventory increases in southern China come from the transfer of imported aluminum ingots from ports to public warehouses. The continuous upside-down spot price difference between the two places will reduce the southward supply of goods from the north, and the space for the price difference between the two places to continue to expand in the short term is limited, and the follow-up is expected to gradually narrow to near Pingshui.

Scan the QR code, apply for participation or join the SMM metal exchange group

Price forecast

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM‘s internal database model. They are for reference only and do not constitute decision-making recommendations.

For any inquiries or to learn more information, please contact: lemonzhao@smm.cn

For more information on how to access our research reports, please contact:service.en@smm.cn

Related News

Feb 7, 2026 17:24

Fed Governor Milan Pushes for Over 100 Basis Points Cut, Contradicts Barkin on Caution

Federal Reserve Governor Milan pointed out that it is necessary for the US Fed to cut interest rates by more than 100 basis points this year. At the same time, he is very much looking forward to the performance of Kevin Warsh as Fed Chairman. However, Richmond Fed President Barkin emphasized that monetary policy must remain cautious until inflation fully pulls back to the target level, thereby ensuring the stability of the labour market.

Feb 7, 2026 17:24

Feb 7, 2026 17:23

Democratic Senators Demand Delay in Fed Nomination Amid Criminal Investigation

All 11 Democratic members of the US Senate Banking Committee jointly sent a letter to the committee's chairman, Tim Scott, requesting that all nomination processes for the prospective Fed Chairman, Kevin Warsh, be postponed until the criminal investigation into current Fed Chairman Powell and other board members is concluded. However, Scott stated that Warsh's confirmation was a done deal.

Feb 7, 2026 17:23

Fed to Keep Large Banks' Capital Levels Unchanged, Postpones Stress Test Reforms Until 2027

The US Fed has announced that it will maintain the capital levels of large banks unchanged during the upcoming stress test cycle (corresponding to the 2026 cycle). At the same time, the US Fed is planning multidimensional reforms to this annual test, aiming to enhance its transparency. The US Fed's Vice Chair for Supervision, Bowman, revealed that adjustments to the stress capital buffer requirements for large banks will be postponed until 2027. This move is intended to provide the US Fed with sufficient time to evaluate potential flaws that may be exposed in its testing models when assessing banks' financial conditions under simulated economic downturn scenarios.

Feb 7, 2026 17:23