SHFE Aluminum Fluctuates at High Levels, Spot Aluminum Transactions Moderate [SMM Spot Aluminum Midday Review]

SMM, February 11—

In the early trading session today, SHFE aluminum front-month contract fluctuated, pulling back slightly compared to the night session, but the price center moved higher, with overall market transactions remaining moderate. Specifically, trading in east China continued to recover. After discussions on today's futures market center, market transactions did not weaken, and downstream buyers also expressed bullish sentiment, supporting spot premiums/discounts to stand firm on quotes. Today, SMM A00 aluminum ingot premiums/discounts against SHFE 2502 contract stood at a discount of 40 yuan/mt, flat from the previous trading day. SMM A00 aluminum ingot prices recorded 20,590 yuan/mt, up 180 yuan/mt from the previous trading day.

In the central China market, overall trading activity still awaited recovery, with some traders intending to stand firm on quotes. Actual market transactions were mainly at SMM central China minus 20 yuan/mt. Today, the Henan-Shanghai price spread was around a discount of 150 yuan/mt. SMM central China A00 aluminum ingot prices against SHFE 2502 contract recorded 20,440 yuan/mt, up 160 yuan/mt from the previous trading day.

Inventory side, according to SMM data on aluminum ingot social inventory across three regions, as of February 11, inventory buildup reached 20,100 mt to a total of 601,100 mt. In the short term, downstream aluminum processing consumption has not fully recovered, and the market remains in a continuous inventory buildup phase. Under the oversupply situation, spot is expected to maintain a discount in the short term. Moving forward, attention should be paid to the resumption progress of downstream aluminum production and disruptions on the aluminum supply side.

Source: SMM

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