Aluminum Ingot Inventories In China Are Falling At A Faster Pace

As of December 7, 2023, SMM reports that domestic aluminum ingot inventories have dropped to 560,000 mt, down 29,000 mt from December 4 and down 38,000 mt WoW, but up 60,000 mt YoY. Domestic aluminum ingot inventories have sharply fallen by 134,000 mt from the short-term peak of 694,000 mt recorded on November 13, down nearly 20%.

Stocks have already seen a swift drop of nearly 150,000 mt since mid-November, a decrease slightly exceeding expectations. With December's arrival, inventory depletion may face disruptions due to the fact that lessened aluminum billet production in northern regions will lead to potential cast ingot volume increases in some areas, and the inflow of imported ingots as import windows open. However, the effects of Yunnan's production cuts are continually unfolding. SMM anticipates overall domestic aluminum ingot inventories will maintain a weak de-stocking trend through year's end. Given the accelerated inventory reduction pace in early December, it's estimated that domestic aluminum ingot stocks may dip to around 500,000 mt at their lowest point this month.