SHANGHAI, May 8 (SMM) –SHFE aluminum will perform better than LME aluminum this week, SMM Expects.
LME aluminum will consolidate between $ 1,900-1,950/tonne. Rumor is circulating that Shandong has released capacity cut document, which will boost SHFE aluminum. SHFE 1706 aluminum should climb to 13,800-14,250 yuan/tonne. The most active SHFE aluminum contract is expected to turn from 1706 into 1707 contract.
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In domestic spot market, while consumption is turning weak, smelters and suppliers are bullish over future prices. Given nearing delivery of SHFE 1705 aluminum and 70 yuan/tonne price spread between SHFE 1705 and 1706 aluminum, spot discounts should narrow further to 0-50 yuan/tonne.
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