SMM Aluminum Market Daily Review (2015-9-7)

Đã xuất bản: Sep 8, 2015 09:50
SHFE 1511 aluminum rose to RMB 11,915/mt after opening at RMB 11,840/mt on Monday.

SHANGHAI, Sept. 8 (SMM) –SHFE 1511 aluminum rose to RMB 11,915/mt after opening at RMB 11,840/mt on Monday. But the most active contract met strong resistance at the 5-day and 10-day moving averages and fell back. In the afternoon, the light metal drifted higher before ending up RMB 35/mt or 0.30% at RMB 11,885/mt. Trading volumes were down 990 lots to 18,490 lots, and positions were down 924 lots to 120,000 lots.

Aluminum prices were mainly between RMB 11,740-11,750/mt in Shanghai on Monday, discounts of RMB 50-40/mt over SHFE 1509 aluminum, versus RMB 11,730-11,750/mt in Wuxi and RMB 11,730-11,740/mt in Hangzhou. Growing arrivals after the 3-day holiday, combined with tepid buying, sent prices down. In the afternoon, spot discounts expanded by RMB 30/mt after SHFE aluminum rose.  

SMM’s latest survey of 40 large aluminum smelters, traders and processors in China reveals the following results:  

Half of them expect aluminum prices to stabilize this week: USD 1,600-1,630/mt for LME aluminum and RMB 11,820-11,900/mt for SHFE 1511 aluminum. US non-farm employment report sent mixed signal in August. Caution will rule the market before the US Fed’s September policy meeting. SHFE aluminum has found support and also met resistance, thus moving in tight range.  

Another 20% see a slight price rise: LME aluminum will rise above USD 1,630/mt, and SHFE 1511 aluminum will climb above RMB 11,900/mt. They believe that demand might pick up in traditional peak-demand September. Besides, production cuts at Chalco, China Power Investment Corporation and other smelters will also encourage investors to raise bullish bets. More loss-making smelters might cut output. LME aluminum has found solid support at the 5-day moving average.  

The rest 30% are bearish. LME aluminum should fall below USD 1,600/mt, and SHFE 1511 aluminum contract will test support at RMB 11,800/mt. These market players are worried that downstream consumption will remain poor. This, together with growing arrivals after the 3-day holiday in China, will widen spot discounts over SHFE front-month contract. Moreover, the scale of new capacity has exceeded that of idled capacity, adding to supply pressure in physical market. China’s manufacturing PMI hit new low in August, reflecting downturn in Chinese economy and boding ill for aluminum consumption. LME aluminum has lost upward momentum and might go down as bearishness in prevailing in base metals market. 






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SMM Aluminum Market Daily Review (2015-9-7) - Shanghai Metals Market (SMM)