Aluminum Prices Rose Significantly, Discounts Widened in Central China and East China Markets [SMM Spot Aluminum Midday Review]

SMM June 3 update:

During the morning session, the SHFE aluminum 2606 contract fluctuated downward, with the overall price center rising significantly from the previous trading day. Affected by the sharp rise in aluminum prices, downstream purchasing sentiment weakened notably. The east China market was relatively sluggish today, with transaction prices continuing to weaken. Mainstream spot cargo quotes in the market ranged from SMMA00 minus 20 yuan/mt to minus 10 yuan/mt. The shipment sentiment index in the east China market was 3.01 today, flat MoM; the purchasing sentiment index was 2.7, down 0.13 MoM.

SHFE aluminum futures prices continued to rise from yesterday's morning session today. Combined with weak off-season orders from downstream processing enterprises in the central China market, overall buying sentiment in the market remained subdued, with enterprises mainly digesting inventories and making small purchases on demand. Only some traders purchased large volumes for term arbitrage when premiums were low. The actual transaction price range in the central China market ultimately hovered at a discount of 230-270 yuan/mt against the SHFE aluminum 06 contract. The shipment sentiment index in the central China market was 2.89 today, flat MoM; the purchasing sentiment index was 2.17, down 0.01 MoM.

Inventory side, aluminum ingot inventory in major consumption areas decreased 1.15 WoW today, with all three regions showing a destocking trend.