Futures Strengthened and Aluminum Prices Remained High, Spot Premiums/Discounts Continued Under Pressure [SMM Spot Aluminum Midday Review]

SMM September 11:

SHFE aluminum's morning trading center rose to around 20,870 yuan/mt. In east China, aluminum prices increased, suppliers' willingness to sell improved, but downstream purchasing was weak, with transaction prices at a discount of 20-10 yuan/mt against SMM prices. Today, the east China market selling sentiment index was 3.09, up 0.02 WoW; buying sentiment index was 2.71, down 0.03 WoW. SMM A00 aluminum was quoted at 20,860 yuan/mt, up 110 yuan/mt from the previous trading day, at parity with the September contract and at a discount of 10 yuan/mt against the October contract.

In central China, Gongyi aluminum ingot inventory continued destocking today, suppliers intended to support premiums and discounts, but high absolute prices led to weak downstream buying sentiment, with actual transaction prices mainly at parity with SMM central China aluminum prices. Today, the central China market selling sentiment index was 3.22, down 0.06 WoW; buying sentiment index was 3.19, up 0.14 WoW. SMM central China A00 was recorded at 20,740 yuan/mt against the SHFE 2509 contract, up 110 yuan/mt from the previous trading day, at a discount of 120 yuan/mt against the September contract and 130 yuan/mt against the October contract.

Inventory side, national aluminum ingot social inventory was recorded at 625,000 mt on Thursday, down 6,000 mt from Monday. Futures prices rose, but premiums and discounts remained under pressure. Although outflows from warehouses improved in September, in-transit cargoes were reportedly still relatively abundant recently.