SMM May 14:
According to SMM statistics, on May 14, aluminum billet inventory across major domestic consumption regions totaled 234,000 mt, down 24,500 mt WoW, with the destocking logic continuing. Warehouse withdrawals side, aluminum billet warehouse withdrawals during 5.07-5.11 totaled 41,500 mt, with performance being average due to the number of trading days. Driven by downstream restocking after the holiday, aluminum billet inventory destocked smoothly. However, due to production cuts at aluminum billet plants in south China and limited aluminum billet inventory in south-west China, warehouse inflows were relatively low. In Wuxi, the persistently tight storage capacity lowered the priority for aluminum billet warehouse inflows, resulting in reduced inflows. As export orders gradually recover, coupled with tight storage capacity, aluminum billet social inventory is expected to maintain its destocking pace, with inventory expected to pull back below 220,000 mt in late May.
Aluminum prices performed strongly during the week, and aluminum billet processing fees pulled back significantly. By region, Foshan quoted 180/230 yuan/mt, down 200 yuan/mt WoW; Wuxi quoted 130/200 yuan/mt, down 170/150 yuan/mt WoW; Nanchang quoted 50/100 yuan/mt, down 300 yuan/mt WoW. Post-holiday aluminum billet transactions were moderate, but after aluminum prices surged again, the market re-entered a wait-and-see mode with relatively weak transactions. Meanwhile, although aluminum billet social inventory was declining, it takes time for inventory to become visible, and short-term consumption momentum remained relatively weak. Processing fees are expected to stay at low levels, and attention should be paid to the correlation between absolute aluminum billet prices and monthly average aluminum prices.
