Aluminum ingot inventory performance is better than the pre-holiday expectations

On May 9, 2024, SMM data showed that the social inventory of aluminum ingots in China’s eight major markets was 778,000 mt, (the amount for sale stood at 652,000 mt), down 13,000 mt from Apr 29, down 16,000 mt compared with May 6 and 38,000 mt YoY, remaining at the lowest compared to the same period of past seven years. In April, the share of aluminium liquid output rose by 1.4% MoM and 2% YoY to 75.36%. The domestic aluminium ingot volume in April was down by 2.77% YoY to around 865,900 mt. SMM believed that the inventory performance of domestic aluminum ingots after Labour Day holiday was better than expected, mainly as low aluminium ingot volume dragged down arrivals during and after the holiday. In addition, the disturbance on aluminum billets supply in Guangxi before and after Labour Day holiday had not yet affected the supply of aluminum ingots. Despite bleak demand, the inventory in Gongyi decreased during Labour Day holiday, mainly as 1. Arrivals during the holiday was lower than expected due to lower ingot volume in Qinghai; 2. Downstream customers who placed orders before the holiday requested delivery during or after the holiday, pushing up cargo pick-up. SMM expected domestic aluminum ingot inventories to remain below 800,000 mt in May.