Trading sentiment is predominantly sluggish, premiums struggle to rise [SMM spot aluminum midday review]

SMM July 21 news:

In early trading, the SHFE aluminum 2606 contract’s price center moved higher compared to the same period of the previous trading day. Affected by the off-season, market procurement sentiment remained weak, and with ample circulating supply, price acceptance did not improve. Mainstream transaction prices stood at a discount of 10-20 yuan/mt against the SHFE aluminum August contract. Today, east China’s shipment sentiment index was 3.1, up 0.02 MoM, while the procurement sentiment index was 2.9, flat MoM.

With the off-season deepening, overall trading sentiment in the central China market was sluggish. Downstream processing enterprises showed limited willingness to purchase, and only a few large factories made small-scale just-in-time procurement constrained by signed long-term contract volumes. Suppliers were eager to sell, and some traders, due to restrictions on accepting high premiums, prompted major suppliers to hold prices firm. As a result, the actual transaction price range in the central China market centered around a discount of 110-140 yuan/mt against the SHFE aluminum August contract. Today, central China’s shipment sentiment index was 3.07, up 0.02 MoM, while the procurement sentiment index was 2.91, down 0.10 MoM.

Inventory side, aluminum ingot inventory in major consumption areas fell 1.35 MoM today, with destocking observed across all three regions.