The most-traded SHFE aluminum contract fluctuated upwards, with spot transactions generally at a discount. [SMM Spot Aluminum Midday Review]

The most-traded SHFE aluminum contract fluctuated upwards. In the east China, sellers were primarily shipping goods, with high aluminum prices and weak downstream sentiment, leading to moderate transactions. According to SMM statistics, aluminum ingot inventory in Wuxi (excluding Hangzhou, Changzhou, Haian, etc.) was 264,300 mt, an increase of 1,500 mt from the previous trading day. Spot discounts slightly widened, with SMM A00 spot aluminum priced at a discount of about 120 yuan/mt to the 2406 contract, down 10 yuan/mt from the previous trading day. The spot price recorded 21,030 yuan/mt. In the second trading session, the market prices shifted upwards, with mainstream transactions in east China showing a discount of 10 yuan/mt to a premium of 10 yuan/mt against SMM A00 spot aluminum.

In the central China, spot transactions were moderate, with relatively sufficient spot supply and downstream procurement mainly driven by rigid demand. Discounts widened, with SMM statistics showing aluminum ingot inventory in Gongyi at about 102,100 mt today, an increase of 300 mt from the previous trading day. Today's SMM central China price was at a discount of about 230 yuan/mt to the 2406 contract, down 40 yuan/mt from the previous trading day. The average spot price recorded 20,920 yuan/mt, with mainstream spot transactions in the early session showing a discount of 20 yuan/mt to a premium of 10 yuan/mt against the SMM central China price.

Overall, according to SMM data, aluminum inventory on May 27 was 781,000 mt, an increase of 14,000 mt WoW. Recently, high aluminum prices inhibited aluminum ingot picked up from warehouses to some extent, with last week's cargo pick-up decreasing by 12,500 mt WoW, showing some fluctuation in inventory. Although the import window for primary aluminum remained closed, limiting the actual inflow of imported supply into the domestic market, bonded warehouse inventory continued to grow. Meanwhile, the resumption of production in Yunnan is progressing, leading to an increase in arrivals. However, orders in multiple sectors have shown slight declines, resulting in continuous inventory accumulation of aluminum ingots over the past two weeks. In the short term, spot premiums and discounts are under pressure, and spot prices may continue to maintain a discount in the near term.