Downstream Restocking and "Rush Exports" Drive Aluminum Ingot Inventory to New Lows in H2 [SMM Aluminum Morning Meeting Summary Nov 22]

Overnight, the most-traded SHFE aluminum 2501 contract opened at 20,700 yuan/mt, reaching a high of 20,710 yuan/mt and a low of 20,590 yuan/mt, closing at 20,620 yuan/mt, down 100 yuan/mt from the previous close, a decrease of 0.48%. On Thursday, LME aluminum opened at $2,634/mt, hitting a high of $2,650/mt and a low of $2,620/mt, closing at $2,633/mt, up $3/mt, an increase of 0.11%.

Summary: On the macro front, as the market expects fewer interest rate cuts by the US Fed next year, the US dollar index continued to rise on Thursday, suppressing the performance of non-ferrous metals. Domestically, the Ministry of Commerce issued a notice on several policy measures to promote stable growth in foreign trade, increasing financial support for foreign trade enterprises. On the fundamentals side, high aluminum costs have raised concerns about production cuts at high-cost enterprises. Downstream demand has slightly rebounded due to the stimulus from rush exports, and aluminum social inventory has returned to a destocking state. The backlog in Xinjiang is unlikely to see concentrated arrivals in the short term, keeping the domestic spot market relatively tight. In the short term, the support logic of high costs and low inventory for domestic aluminum remains, but the support for aluminum prices has weakened, with short-term aluminum prices expected to fluctuate and consolidate.