A00 aluminium ingot price drops in China despite a W-o-W fall in primary inventory

According to the latest update by Shanghai Metals Market, primary aluminium inventories across major consumption areas in China has recorded a further fall this week with limited arrivals. Stocks across eight consumption areas, including SHFE warrants, shrank around 14000 tonnes from last Thursday, August 9, and 5000 tonnes from last Monday, August 13, to stand at 1.761 million tonnes as of August 16.

The current inventory status in the major Chinese cities stands as follows:

But despite the limited supplies of primary aluminium stocks in the market, the A00 aluminium ingot price failed to record a surge. As of August 16, the price has clocked a drop of RMB 160 per tonne to stand at RMB 14330 per tonne, in contrast to RMB 14490 per tonne on August 15.  The average prices are expected to range between RMB 14310 per tonne and RMB 14350 per tonne, with spot discounts to settle at RMB 70 per tonne to RMB 30 per tonne.

In the east, the price has plunged from RMB 14500 per tonne to RMB 14340 per tonne, while in the south and north, the prices have shrunk from RMB 14585 per tonne to RMB 14450 per tonne and from RMB 14470 per tonne to RMB 14360 per tonne, respectively.

The primary aluminium prices on Shanghai Metal Exchange and London Metal Exchange have also stood down. As of August 16, the SME price is standing at US$ 2078 per tonne, after registering a fall for last two consecutive days and the LME price, as on August 15, stood at US$ 1994.5 per tonne, in contrast to US$ 2038 per tonne on August 14 and 2052 on August 13.