SHFE Aluminum Center Moves Up, Alumina Prices Jump Initially and Then Pull Back [SMM Aluminum Futures Brief]

》Check SMM Aluminum Product Prices, Data, and Market Analysis

SMM, January 13:

Today, the most-traded SHFE aluminum 2502 contract opened at 20,235 yuan/mt, with a high of 20,275 yuan/mt, a low of 20,125 yuan/mt, and closed at 20,215 yuan/mt, up 0.8%. Trading volume was 107,000 lots, and open interest was 109,000 lots.

SMM Comments: Macro side, mixed signals persist. The Chinese government continues efforts to boost consumption, while uncertainty remains over the US Fed's interest rate cut pace. Fundamentals side, aluminum capacity remained stable in early January, while alumina fundamentals maintained a slight surplus. Spot alumina prices are expected to continue their short-term downward trend, and aluminum industry costs may keep declining. Demand side, market demand weakened further during the off-season, with operating rates in the aluminum processing sector declining steadily. Some aluminum processing plants are nearing holiday shutdowns. Although pre-holiday stockpiling has led to an unexpected inventory drawdown, providing short-term support for aluminum prices, its sustainability is expected to be limited. Key focus points include the impact of spot alumina price pullbacks on aluminum costs and the continuation of downstream holiday schedules and pre-holiday stockpiling.

Today, the most-traded alumina 2502 contract opened at 4,062 yuan/mt, reached a high of 4,152 yuan/mt, a low of 4,040 yuan/mt, and closed at 4,083 yuan/mt, down 0.2%. Trading volume was 180,000 lots, and open interest was 84,000 lots.

SMM Comments: Recently, weekly alumina operating rates have continued to edge up slightly, while demand remained relatively stable. With low-price transactions gradually emerging in the market, some suppliers have become more active in selling, increasing the availability of spot alumina in circulation. Spot transactions have seen a wider discount to online prices. In the short term, some alumina capacity in Shanxi is expected to resume production, leading to an anticipated increase in supply. On the demand side, aluminum operating rates remain relatively stable. Alumina fundamentals are expected to maintain a slight surplus, and spot alumina prices are likely to continue their short-term downward trend.

[The information provided is for reference only. This article does not constitute direct investment research advice. Clients should make prudent decisions and not substitute this for independent judgment. Any decisions made by clients are unrelated to SMM.]