7.2 SMM Cast Aluminum Alloy Morning Comment
Futures Market: Overnight, the most-traded cast aluminum alloy AD2511 futures contract opened at 19,830 yuan/mt, peaking at 19,935 yuan/mt and bottoming at 19,810 yuan/mt before closing at 19,880 yuan/mt. The settlement marked a 55 yuan/mt or 0.28% increase from the previous trading day, with trading volume at 2,670 lots and open interest at 8,964 lots, dominated by bullish position increases.
Basis Report: SMM data shows that on July 1, the SMM ADC12 spot price maintained a theoretical premium of 345 yuan/mt against the 10:15 AM closing price of the most-traded cast aluminum alloy contract (AD2511).
Aluminum Scrap Sector: Primary aluminum spot prices remained unchanged from the previous trading day, with SMM A00 aluminum closing at 20,780 yuan/mt and aluminum scrap market prices stabilizing overall. Baled UBC scrap quotations concentrated at 15,300-15,800 yuan/mt (tax excluded), while shredded aluminum tense scrap clustered at 15,800-17,300 yuan/mt (tax excluded). By product category, baled UBC prices dropped 100 yuan/mt MoM from the previous day, though localized material shortages prompted selective premium collections against market trends. Regarding scrap-to-primary spreads, the Foshan mixed aluminum extrusion scrap free of paint price difference widened 20 yuan/mt to 1,756 yuan/mt compared to last Friday, while the Jiangsu bare bright aluminum wire spread narrowed 273 yuan/mt MoM to return to 653 yuan/mt.
Overseas Markets: Imported ADC12 CIF quotations held steady at $2,450-2,480/mt, with import spot prices hovering near 19,200 yuan/mt and instant import losses around 800 yuan/mt. Thailand's domestic ADC12 tax-excluded quotations concentrated at 82-83 baht/kg.
Inventory Update: SMM statistics indicate that as of July 1, the combined social inventory of secondary aluminum alloy ingots across Foshan, Ningbo, and Wuxi reached 21,048 mt, up 1,287 mt from the previous trading day.
Summary: Aluminum prices stabilized on Tuesday with limited ADC12 raw material fluctuations, keeping mainstream quotations stable. The SMM ADC12 price range held at 20,000-20,200 yuan/mt, though actual transactions remained sluggish. Entering July, weak downstream order growth will continue to constrain ADC12 price upside, yet firm cost support provides a price floor. With no near-term consumption improvements anticipated and off-season effects deepening, ADC12 prices are expected to fluctuate rangebound.
[The provided information is for reference only. This publication does not constitute direct investment research or decision-making advice. Clients should exercise caution, avoid substituting independent judgment herewith, and assume sole responsibility for all trading decisions which are unrelated to SMM.]
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