In the morning session today, the center of SHFE aluminum prices declined to around 20,050 yuan/mt, fluctuating rangebound. In terms of spot market performance, spot aluminum supply in east China was relatively ample, and downstream enterprises' restocking sentiment slowed slightly due to the rise in aluminum prices. Coupled with the weakening of orders on hand for most enterprises, and after completing restocking earlier, downstream enterprises showed weak purchasing power in the face of the upcoming holiday. The market was trading at a discount of 10 yuan/mt against SMM transactions. SMM A00 aluminum ingot prices were reported at 20,060 yuan/mt, up 40 yuan/mt from the previous trading day, trading at a discount of 10 yuan/mt against the May contract, down 10 yuan/mt from the previous trading day.
In the central China market, with the continuous stockpiling over the past few days, inventory in the central China region continued to decline, and spot aluminum became tighter during the day. Suppliers took the opportunity to raise premiums for shipments, but most downstream enterprises had already completed stockpiling, causing the transaction prices in central China to decline throughout the day. SMM central China A00 aluminum was recorded at 20,010 yuan/mt against the SHFE aluminum 2505 contract, up 50 yuan/mt from the previous trading day. The price spread between Henan and Shanghai was -50 yuan/mt, narrowing by 10 yuan/mt from the previous trading day. Actual market transactions were trading at parity to a premium of 20 yuan/mt against SMM central China prices, and at a discount of 60 yuan/mt against the 2505 contract.
On the inventory side, according to SMM's data on aluminum ingot inventory in three domestic regions, the weekly inventory of domestic aluminum ingots as of April 30 was 614,000 mt, a destocking of 29,000 mt from the previous day. As May approaches, downstream consumption is expected to weaken to varying degrees. It is anticipated that the destocking speed will slow down, and premiums may struggle to rise.
