Some enterprises are on holiday for the New Year, and overall trading sentiment has further weakened. [SMM Spot Aluminum Midday Review]

SMM February 13:

SHFE aluminum 2602 fluctuated downward in the morning session, with the price center lower than the previous trading day. Some enterprises were already on Chinese New Year break, overall market sentiment was weak, and mainstream quotations concentrated at the average price to a premium of 50 yuan/mt. Today, the shipment sentiment index in the east China market was 2, down 0.21 WoW; the purchasing sentiment index was 2.07, down 0.27 WoW. SMM A00 aluminum was quoted at 23,160 yuan/mt, down 190 yuan/mt from the previous trading day, at a discount of 120 yuan/mt against the 2602 contract, up 40 yuan/mt from the previous trading day; at a discount of 190 yuan/mt against the 2603 contract.

Trading in the central China market remained sluggish today. On the last trading day before the Chinese New Year, pre-holiday stockpiling by downstream processing enterprises had basically ended, with only a small amount of just-in-time procurement. Most traders had already entered the Chinese New Year holiday, resulting in limited spot aluminum supply in the market. Only a few traders engaged in buying the dip for stockpiling. Ultimately, actual transaction prices in the central China market ranged from a premium of 400 yuan/mt to a premium of 60 yuan/mt against the central China price. Today, the shipment sentiment index in the central China market was 2.25, down 0.18 WoW; the purchasing sentiment index was 1.9, down 0.19 WoW. SMM central China closed at 23,080 yuan/mt, down 180 yuan/mt from the previous trading day, at a discount of 200 yuan/mt against the 2602 contract, up 50 yuan/mt from the previous trading day. SMM central China closed at 23,080 yuan/mt, down 180 yuan/mt from the previous trading day, at a discount of 200 yuan/mt against the 2602 contract, up 50 yuan/mt from the previous trading day.

Inventory side, aluminum ingot inventory in major consumption areas increased by 8,000 mt WoW today, with all three regions showing inventory buildup. In the short term, high aluminum prices may continue to suppress end-use demand, coupled with the impact of the downstream Chinese New Year break, aluminum ingots still face inventory buildup risks, and spot premiums/discounts are expected to remain under pressure.