Alumina Weakness Persists, SHFE Aluminum Fluctuates Rangebound [SMM Aluminum Futures Brief Review]

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

SMM, March 17:

Today, the most-traded SHFE aluminum 2505 contract opened at 20,940 yuan/mt, with a high of 21,005 yuan/mt, a low of 20,820 yuan/mt, and closed at 20,925 yuan/mt, down 0.05%. The trading volume was 10,600 lots, and the open interest was 263,000 lots.

SMM Comments: On the macro front, US consumer confidence plunged in March, while inflation expectations surged. Domestically, the favorable macro tone remains unchanged, with the government emphasizing stronger policy measures and fostering positive market interactions to maximize policy effectiveness. These macro factors provided support for aluminum prices. Fundamentals side, domestic aluminum production resumption continued to advance. With spot prices of alumina, petroleum coke, and other auxiliary materials fluctuating downward, cost-side support for aluminum further weakened. During the week, aluminum ingot social inventory continued destocking. Short-term recovery in aluminum processing enterprises persisted, but consumption recovery fell slightly short of expectations. High aluminum prices suppressed downstream purchase willingness, limiting operations at some enterprises during the week, resulting in a modest rebound. Meanwhile, spot premiums in various regions were constrained. Aluminum prices are expected to hover at highs in the near term, with close attention to changes in US tariff policies and the actual release of downstream demand. Overall, the macro front presents a mix of bullish and bearish factors. Domestically, the favorable macro tone remains unchanged, while overseas trade barriers increase with significant uncertainty. Fundamentals side, both supply and demand showed growth trends. As the consumption peak season approaches, most sectors saw increases in order volumes and operating rates, coupled with aluminum ingot social inventory destocking, providing strong support for aluminum prices. Under the resonance of macro factors and the industry chain, aluminum prices are expected to fluctuate upward at highs in the short term.

Today, the most-traded alumina 2505 contract opened at 3,130 yuan/mt, with a high of 3,152 yuan/mt, a low of 3,100 yuan/mt, and closed at 3,114 yuan/mt, down 0.48%. The trading volume was 75,000 lots, and the open interest was 217,000 lots.

SMM Comments: Recently, the tug-of-war between alumina buyers and sellers continued. The spot alumina market saw sporadic transactions, with transaction prices further slightly declining, centering around 3,200-3,300 yuan/mt. The domestic alumina export window has closed, and the total registered warrant volume in alumina futures delivery warehouses exceeded 200,000 mt. Subsequent alumina exports and transfers to delivery warehouses may struggle to provide sustained demand. Fundamentals side, short-term alumina operating capacity is expected to see simultaneous increases and decreases, with no significant decline in total operating capacity anticipated. This week, the total national alumina operating capacity was 88.26 million mt. The alumina fundamentals maintained a slight surplus pattern, and 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 prudent decisions and not substitute this for independent judgment. Any decisions made by clients are unrelated to SMM.]