Interest Rate Cut Expectations Strengthen, Alumina Prices Collapse and Decline [SMM Aluminum Futures Brief]

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

SMM, March 10:

Today, the most-traded SHFE aluminum 2504 contract opened at 20,855 yuan/mt, with a high of 20,950 yuan/mt and a low of 20,790 yuan/mt, closing at 20,895 yuan/mt, up 0.05%. Trading volume was 12,100 lots, and open interest was 196,000 lots.

SMM Comments: On the macro front, US employment data fell short of expectations, strengthening the anticipation of multiple interest rate cuts by the US Fed this year, leading to a pullback in the US dollar index. Domestically, the Two Sessions signaled efforts to stabilize the economy, providing macro-level support for aluminum prices. Fundamentals side, domestic aluminum production resumption is progressing, with capacity expected to be released by the end of March. On the inventory side, this week’s aluminum inventory continued destocking. According to the SMM survey, aluminum social inventory decreased by 18,000 mt WoW to 868,000 mt today. Coupled with the "golden March and silver April" peak season, operating rates of aluminum processing enterprises continued to rebound, strengthening aluminum consumption support. Overall, the macro front remains mixed, with domestic macro positives unchanged, while overseas trade barriers are increasing but remain highly uncertain. Fundamentals side, both supply and demand are growing. As the consumption peak season approaches, most sectors are seeing a rebound in order volumes and operating rates, combined with aluminum ingot social inventory destocking, providing strong support for aluminum prices. In the short term, aluminum prices are expected to fluctuate upward at high levels.

Today, the most-traded alumina 2505 contract opened at 3,267 yuan/mt, with a high of 3,280 yuan/mt and a low of 3,173 yuan/mt, closing at 3,195 yuan/mt, down 2.59%. Trading volume was 150,000 lots, and open interest was 200,000 lots.

SMM Comments: Recently, the tug-of-war between alumina buyers and sellers continues, with sluggish spot alumina transactions and spot prices remaining stable. Overseas alumina transaction prices have further declined, and the domestic alumina export window has closed, making it difficult for alumina exports to provide sustained demand in the future. Fundamentals side, no large-scale production cuts have been reported in alumina operating capacity, and the alumina market remains in a slight surplus. Spot alumina prices are likely to fluctuate downward in the short term.

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