Destocking in fundamentals provides support for premiums, with downstream enterprises mainly purchasing as needed [SMM Spot Aluminum Midday Review]

Published: May 21, 2025 11:45

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[SMM Midday Review of Spot Aluminum: Fundamentals-Driven Destocking Provides Support for Premiums, Downstream Purchasing as Needed] Inventory side, according to SMM's domestic aluminum ingot inventory data, the three-region inventory of domestic aluminum ingots stood at 447,000 mt on May 21, with a destocking of 10,500 mt compared to the previous day. In the short term, the relatively low arrival of goods in east China is conducive to the rise in premiums and discounts, and attention should be paid to the changes in demand in the following days.

SMM, May 21 Report

Today, SHFE aluminum fluctuated in the morning session, with its center moving higher. From the perspective of spot market performance, social inventory destocking provided support for local spot premiums. Downstream enterprises purchased aluminum as needed amid high aluminum prices.

Specifically, trading in east China was moderate today. Limited arrivals provided strong support for prices. Overall, purchases were made as needed, and market transactions were concluded at prices ranging from the SMM average price to +10 yuan/mt above it. Today, SMM A00 aluminum was quoted at 20,310 yuan/mt, up 100 yuan/mt from the previous trading day, with a premium of 70 yuan/mt against the June contract, unchanged from the previous trading day.

In the central China market, transactions were mainly concluded at prices around the SMM central China average price. SMM central China A00 aluminum was recorded at 20,240 yuan/mt against the SHFE aluminum 2506 contract, up 100 yuan/mt from the previous trading day. The price spread between central China and east China was 70 yuan/mt, unchanged from the previous trading day, and it was on par with the 2506 contract.

In terms of inventory, according to SMM's domestic aluminum ingot inventory data, the three-region inventory of domestic aluminum ingots stood at 447,000 mt on May 21, a destocking of 10,500 mt from the previous day. In the short term, limited arrivals in east China are conducive to the firming up of premiums and discounts. Attention should be paid to changes in demand in the future.

Data source: SMM

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Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM‘s internal database model. They are for reference only and do not constitute decision-making recommendations.

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