Aluminum Price Breaks Through 20,000 Yuan/mt Threshold Again, Spot Premiums Suppressed [SMM Spot Aluminum Midday Review]

SMM, May 13: In the morning session today, the center of SHFE aluminum prices continued to rise, breaking through the 20,000 yuan/mt threshold. In east China, as inventory levels have continued to destock recently and expectations for subsequent arrivals are low, suppliers generally have a strong sentiment to stand firm on quotes. The market is mainly trading at a premium of 10 yuan/mt against SMM transactions. Today, SMM A00 aluminum is quoted at 20,010 yuan/mt, up 200 yuan/mt from the previous trading day, and trading at a discount of 20 yuan/mt against the May contract.

In the central China market, inventory levels continue to destock, and suppliers have a strong sentiment to stand firm on quotes. However, after the center of aluminum prices moved higher, market demand decreased. In the central China region, spot premiums were initially quoted high but later fell, with spot premiums experiencing a price collapse, trading at a discount of 10 yuan/mt against SMM transactions in central China. SMM A00 in central China recorded 20,000 yuan/mt against the SHFE aluminum 2505 contract, up 190 yuan/mt from the previous trading day. The price spread between central China and east China is -10 yuan/mt, and it is trading at a discount of 30 yuan/mt against the 2505 contract.

On the inventory side, as of May 13, the inventory of aluminum ingots in three domestic regions was 479,400 mt, a destocking of 3,700 mt WoW. With aluminum prices returning to the high level of 20,000 yuan/mt, it is expected to significantly curb downstream consumption. The pace of destocking will slow down, and spot premiums will be suppressed.

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