Narrower spot discounts hold traders back from buying aluminium in east China

SHANGHAI, Jun 11 (SMM) – Traders in the spot aluminium market in east China held back from purchasing and took a watch-and-wait stance on Monday June 11 as spot discounts against the SHFE 1806 contract narrowed, SMM learned.

In the Shanghai market, transactions were mostly heard at 14,710-14,720 yuan/mt with discounts of 30-20 yuan/mt against the SHFE 1806 contract, compared to 60-50 yuan/mt a week ago. The discounts stood at around 110 yuan/mt against the SHFE 1807 contract. In Wuxi and Hangzhou, transactions were mostly done at 14,710-14,720 yuan/mt and 14,740-14,760 yuan/mt, respectively.

Sellers in east China were keen to offload their cargoes while downstream consumers purchased on demand. Overall trading was relatively thin.

In the Guangdong market, transactions were mostly heard at 14,790-14,810 yuan/mt with Guangdong-Shanghai price spread at about 80 yuan/mt. Local inventory continued to shrink with aluminium ingot stocks at Guangdong warehouses down 13,000 mt from last Thursday and standing at 271,000 mt as of Monday June 11.

Given the shrinking inventory, sellers were relatively reluctant to let go their cargoes and supply in the market was limited as a result. Downstream consumers purchased as needed. Overall trading in Guangdong was brisk.

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