SHANGHAI, Mar 17(SMM) - The most-traded SHFE 2205 aluminium opened overnight at 22,005 yuan/mt, with the lowest at 21,890 yuan/mt and highest at 22,235 yuan/mt, closing at 21,940 yuan/mt, up 240 yuan/mt or 1.11% than yesterday. LME aluminium opened at $3,288/mt on Wednesday ranging between $3,245-3,375/mt before closing at $3,265.5/mt, a decrease of $33.5/mt or 1.02%.
Macro: (1) Fed raised the interest rate by 25 basis points as expected and hinted that it may raise rates each time in the remaining six meetings during the year (bearish ★★); (2) On March 16, the Financial Stability Development Committee of the State Council held a special meeting to study the current economic situation and capital market issues (bullish ★★)
Fundamentals: (1) The current round of domestic pandemic has not caused a major impact on the production of domestic electrolytic aluminium for the time being ( bearish ★); (2) due to the pandemic, the transactions of scrap aluminium continued to reduce this week(bullish ★)
Spot: Fundamentally, the speed of destocking in East China slightly lagged behind the South China and the Central region, and the pandemic still affected the delivery of upstream and downstream in transport. On March 16, discounts of spot market in East China stood at 20 yuan/mt.
Conclusion: The operating capacity of domestic electrolytic aluminium in the supply side grew, with the transport efficiency of aluminium ingot declined in some areas due to the pandemic. Demand-side consumption continued to recover, with the pandemic driving some downstream actively stockpiling. Focus on the impact of the pandemic on transport and the willingness of downstream enterprises to stock.
