SMM, July 3:
In the morning session, the SHFE aluminum 2606 contract traded at a higher center than the same period of the previous trading day. Buying sentiment picked up somewhat, boosted by Friday stockpiling, but remained at a weak level. Market liquidity was relatively ample, with mainstream transactions at parity to a premium of 10 yuan/mt against the SHFE aluminum July contract. In east China today, the shipment sentiment index stood at 2.91, flat MoM, while the procurement sentiment index came in at 2.79, up 0.06 MoM.
Following the sharp drop on the futures market, aluminum prices rebounded for two consecutive days, yet bearish sentiment in the central China market remained strong. With the weekend stockpiling cycle approaching, downstream processing enterprises still mainly made just-in-time procurement, with only small-scale raw material stockpiling, leaving the overall market trading atmosphere largely sluggish. Suppliers also showed limited willingness to hold prices firm. Ultimately, actual transaction prices in the central China market were centered around a discount of 50-70 yuan/mt against the SHFE aluminum July contract. In the central China market today, the shipment sentiment index was 2.89, up 0.01 MoM, while the procurement sentiment index stood at 2.12, up 0.01 MoM.
On the inventory front, aluminum ingot inventories in major consumption areas fell by 1.95 MoM today, with all three regions showing destocking.
