SMM January 21:
SHFE aluminum 2602 fluctuated upward in the morning session, with the price center slightly higher than the previous trading day. Today, overall market buying sentiment improved slightly but remained at a low level, with mainstream transaction prices mainly ranging from a discount of 10 yuan/mt to a premium of 10 yuan/mt. The east China market selling sentiment index was 2.89, up 0.04 MoM; the buying sentiment index was 2.46, up 0.03 MoM. SMM A00 aluminum closed at 23,710 yuan/mt, up 30 yuan/mt from the previous trading day, at a discount of 150 yuan/mt against the 2602 contract, up 10 yuan/mt from the previous trading day.
Central China market buying sentiment slightly increased compared to the previous day. Although downstream processing enterprises cut production by about 20% due to environmental protection-related controls, road transport gradually resumed after the heavy snow ended in Henan, leading to a slight overall improvement in buying sentiment. As aluminum plant shipments had not fully recovered, suppliers raised prices for shipments. Actual transaction prices in the central China market today ranged from a premium of 10 yuan/mt to a premium of 40 yuan/mt against the central China price. The central China market selling sentiment index was 2.68, flat MoM; the buying sentiment index was 2.21, up 0.02 MoM. SMM central China aluminum closed at 23,610 yuan/mt, up 50 yuan/mt from the previous trading day, at a discount of 250 yuan/mt against the 2602 contract, up 30 yuan/mt from the previous trading day. The Henan-Shanghai price spread was -100 yuan/mt, narrowing by 20 yuan/mt from the previous trading day.
Inventory side, aluminum ingot inventory in major consumption areas decreased by 6,000 mt WoW on Wednesday, with destocking observed in all three regions. In the short term, high aluminum prices may continue to suppress end-use demand, aluminum ingots still face inventory buildup risks, and spot premiums/discounts are expected to remain under pressure.
