SHANGHAI, Nov 25 (SMM) - The stocks of aluminium billet in five major consumption areas dropped 21,600 mt to 78,900 mt on November 25 from a week ago, a decrease of 21.5%. And the inventory has been falling for six straight weeks.

The inventory in Foshan and Huzhou dropped the most, while Wuxi and Changzhou also experienced falls in local inventories. The main cause is that the downstream sector actively purchased on rises as aluminium prices have been increasing continuously in the week, which recorded 19,320 yuan/mt in east China, up 980 yuan/mt from a week ago, according to SMM. Meanwhile, the transportation capacity was reduced in north-west China due to poor weather, hence the arrivals from north to south China was postponed. The weekly arrivals in south China were at a comparatively low level.

Looking into the following week, the orders of aluminium extruders in Shandong and Jiangxi improved according to SMM research, creating more demand for aluminium billet; while the overall operating rates of aluminium billet companies have been relatively stable. However, the supplies from the north will continue to be delayed due to reduced transportation capacity in north-west China. Hence, the aluminium billet inventory is likely to fall again.