The First Trading Day After the Holiday: Market Mainly Observes, Transactions Sluggish [SMM Spot Aluminum Midday Review]

In the early trading session today, the SHFE aluminum front-month contract fluctuated rangebound, dropping to around 20,240 yuan/mt, and plunged below 20,200 yuan/mt at the end of the second session. In the east China market, on the first trading day after the holiday, buyers and sellers had not fully returned. Under the inventory buildup pace during the off-season, the market turned into a buyer's market with sluggish intraday trading. SMM A00 aluminum ingot prices were at a discount of 40 yuan/mt to the SHFE aluminum 2502 contract, down 20 yuan/mt from the previous trading day. SMM A00 aluminum ingot prices recorded 20,140 yuan/mt, up 20 yuan/mt from the previous trading day.

In the central China market, suppliers resumed long-term contract deliveries after the holiday, while downstream enterprises prioritized consuming cold-rolled finished product inventories before restarting casting and rolling production lines. Intraday trading in the spot market was sluggish. Today, the Henan-Shanghai price spread was at a discount of 130 yuan/mt, widening by 30 yuan/mt from the previous trading day. SMM central China A00 aluminum ingot prices were at 20,010 yuan/mt against the SHFE aluminum 2502 contract, down 10 yuan/mt from the previous trading day, with actual market transactions around 20 yuan/mt lower than SMM central China prices.

In terms of inventory, after the holiday, weekly inventories in SMM's major aluminum consumption regions recorded 654,000 mt, with an inventory buildup of 162,000 mt, exceeding the seasonal highs of previous years. Downstream consumption had not yet recovered, and the market remained in an oversupply situation, with spot discounts expected to continue expanding.

Source: SMM

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