Aluminum prices swung on a strong note before Labour Day holiday, preventing aluminum rod processing fees from going up

On April 30, 2024, the average ex-factory price of 1A60 general aluminum rod processing fee by region: Shandong (350 yuan/mt); Henan (300 yuan/mt); Inner Mongolia (150 yuan/mt); south China (450 yuan/mt). On the last trading day of April, as aluminum prices remained high and stocking came to the end, the aluminum rod market transaction was sluggish, and companies lowered processing fees to sell-off for cash before the holiday.

Since April, the rigid demand of downstream enterprises gradually released, boosting transaction sentiment of aluminum rod market. The actual transaction price rebounded significantly compared with March. However, due to the high aluminum price, the downstream purchasing sentiment was still cautious. In addition, high aluminum prices prevented aluminum rod processing fees from reaching peak season levels. Some companies transferred part of their production capacity from ordinary rods to high-conductivity rods and alloy rods due to their orders improvement, alleviating pressure of ordinary rods on the supply. In May, supported by UHV orders and driven by the delivery pressure of photovoltaic orders in the market, the average operating rate of aluminum wire and cable industry is expected to remain high, and the demand for aluminum rods may further pick up. However, amid high aluminum prices, the overall processing fee of aluminum rods stabilized.