Restocking Demand Drives Narrowing of Premiums, Processing Fees of Aluminum Billets Maintain Discounts and Continue Weakness [SMM Southern China Spot Aluminum Daily Report]

SMM January 9:

South China aluminum ingot, January 9 SMM A00 aluminum (Foshan) was quoted at 24,100 yuan/mt, up 70 yuan/mt, at a discount of 25 yuan/mt to the current month, narrowing by 95 yuan/mt. In early trading, aluminum prices edged up, while market sentiment shifted from hot to cold. Supported by bullish expectations, suppliers raised prices to sell, but increased spot supply due to accelerated hedging liquidation led to offers gradually declining to premiums of 0-20 yuan. Restocking demand from downstream sectors recovered, driving transactions; however, buying interest at high levels was insufficient. Later, futures prices surged, pushing up offers, and suppliers quickly followed with their quotes. Yet, buyers exhibited strong wait-and-see sentiment, resulting in weak purchasing momentum.

South China aluminum billet, January 9 SMM 6063 aluminum billet (Guangdong) processing fees for various specifications came under significant pressure and pulled back, with the average for Φ90/100 down 60 yuan/mt and Φ120 and above down 110 yuan/mt, up 30 yuan/mt from the previous day. Aluminum billet market processing fees turned to discounts under pressure. After downstream players rushed to buy amid continuous price rise for small restocking, transactions were mediocre. Overall transaction prices are expected to pull back.