The inventory growth slows down but the spot supply is sufficient. East and central China maintained discount. [SMM Spot Aluminum]

In early trading today, the most-traded SHFE aluminum contract dropped after opening, once hitting a low of 10,925 yuan/ton, and then fluctuated upward. Today, holders in east China mainly shipped goods. Today’s aluminum ingot inventory in Wuxi (excluding Hangzhou, Changzhou, Haian and other places) is 238,000 tons, up 100 tons from the previous trading day. The supply was sufficient and aluminum prices went up, the enthusiasm for spot trading is lower than in previous days amid moderate transactions. Today's SMM A00 aluminum price has a discount of 40 yuan/ton against the 2403 contract, which is the same as the previous trading day. The spot price recorded 19,050 yuan/ton, in the second trading session, the prices drifted sideways. Today, the mainstream transaction in east China has a discount of 10 yuan/ton to a premium of about 10 yuan/ton for SMMA00 aluminum price.

Today's spot transactions in the central China were acceptable. Downstream purchased only as needed and the supply was sufficient. Spot prices in the central China remained at a large discount. According to SMM statistics, today's aluminum ingot inventory in Gongyi is approximately 168,500 tons, an increase of 1,200 tons from the previous trading day. Today, the SMM central China price has a discount of about 160 yuan/ton against the 2403 contract, which is the same as the previous trading day. The average spot price recorded 18,930 yuan/ton. The mainstream spot transaction in early trading has a discount of 10 yuan/ton to a premium of 20 yuan/ton for SMM central China price.

Overall, according to SMM data, the national aluminum inventory on Thursday was up by 32,000 tons to 821,000 tons compared with last Thursday. The pace of inventory growth has slowed down. The level of inventory has remained at a low level for the same period in nearly seven years, down 32.7% YoY. However, aluminum ingot inventory is still growing. SMM predicts that domestic aluminum ingot inventories may reach between 800,000-900,000 tons in the first half of March, and spot supply is expected to remain relatively loose in the short term. On the supply, according to SMM, an aluminum plant in Sichuan plans to undergo technical transformation and is expected to shut down by the end of the month. The previous operating capacity was about 65,000 tons/year; Aluminum plants in Yunnan will mainly maintain stable production in the short term. On the demand, the production resumption after CNY holiday has boosted the operating rate of aluminum downstream enterprises, and downstream demand may improve in traditional peak season. It is expected to form a certain support for aluminum prices, and we need to pay attention to changes in the supply of aluminum in the future.