The aluminum price in central China Foshan fell below 19,000 yuan/mt, and the spot market transactions were relatively moderate

Published: Jul 25, 2024 15:58

Source: SMM

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In the early trading session today, the most-traded SHFE aluminum contract fluctuated downward before slightly rebounding.

In the early trading session today, the most-traded SHFE aluminum contract fluctuated downward before slightly rebounding. The spot market in east China saw moderate transactions, with downstream buyers mainly purchasing as needed. According to SMM statistics, aluminum ingot inventory in Wuxi (excluding Hangzhou, Changzhou, Haian, etc.) was 301,000 mt, a decrease of 1,700 mt from the previous trading day. Today, the SMM A00 spot aluminium price had a discount of 50 yuan/mt against the 2408 contract, an increase of 10 yuan/mt from the previous trading day, with the spot price recorded at 19,010 yuan/mt. In the second trading session, the market mainly fluctuated upward. The mainstream transactions in east China today had a discount of 10 yuan/mt to a premium of 10 yuan/mt against the SMM A00 spot aluminium price.

Today, transactions in central China were mediocre, with sellers actively offloading goods and downstream buyers mainly restocking only as needed. Spot discounts remained significant. According to SMM statistics, aluminum ingot inventory in Gongyi today was about 91,300 mt, a decrease of 4,100 mt from the previous trading day. Today, the SMM central China price was at a discount of around 170 yuan/mt to the 2408 contract, flat compared to the previous trading day. The average spot price recorded was 18,890 yuan/mt, falling back below 19,000 yuan/mt. Mainstream spot transactions in the early session were at a discount of 10 yuan/mt to a premium of 10 yuan/mt to the SMM central China price.

According to SMM data, the social inventory of aluminum ingots was 790,000 mt on Thursday, down 2,000 mt from Monday and 7,000 mt from a week ago. Overall, the supply side has shown a continuous growth trend in recent months, while demand has weakened with the arrival of the off-season. The operating rate of the aluminum processing industry has fallen to a low point, and the effects of some stimulus measures have yet to be seen. Under these circumstances, destocking of the social inventory of aluminum ingots has been difficult. As of July 25, the social inventory of aluminum ingots is at a relatively high level compared to the same period in the past three years. With ample market circulation, short-term spot discounts may persist under inventory pressure.

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