Pre-Month-End Stockpiling and Long-Term Contract Final Delivery Date, Purchasing Enthusiasm Low [SMM Spot Aluminum Midday Review]

SMM July 24 news:

In the morning session, the SHFE aluminum 2606 contract trading center was lower than the same period of the previous trading day. Affected by weekend stockpiling and lower aluminum prices, market buying sentiment picked up, but as market supply remained ample, the acceptance of market prices only edged up slightly. Mainstream transaction prices were at a discount of 10 yuan/mt to a premium of 10 yuan/mt against the SHFE aluminum August contract. Today, the east China market selling sentiment index was 3.13, flat MoM; the buying sentiment index was 2.94, up 0.03 MoM.

Today, aluminum futures edged down. Coinciding with pre-weekend stockpiling and the last long-term contract delivery day of the month, traders in the central China market purchased heavily to fulfill long-term contracts, and downstream processing enterprises’ stocking sentiment recovered slightly, prompting suppliers to keep their shipment offers persistently high, with a clear intention to hold prices firm and hold back from selling. Finally, the actual transaction price range in the central China market was around a discount of 100-120 yuan/mt against the SHFE aluminum August contract. Today, the central China market selling sentiment index was 3.10, up 0.01 MoM; the buying sentiment index was 2.96, up 0.08 MoM.

On the inventory front, today’s aluminum ingot inventory in major consumption areas fell by 0.8 MoM, with all three regions showing destocking.