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17 JANUARY 2018 AL CIRCLE

A00 ingot price in China drops further on growing inventory and slow consumption

EDITED BY : BEETHIKA BISWAS 2MINS READ

Aluminium prices in China are under pressure as Chinese inventory grows on slow consumption. As reported by Shanghai Metals Market, Average A00 ingot price dropped further to stand at RMB 14,440 per tonne today from RMB 14,700 and expected to move within a range of RMB 14,420-14,460. Spot discount will range within RMB 120-80 per tonne today. Aluminium ingot prices registered a drop in all individual markets in China. 

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As of January 12, domestic primary aluminium inventory stood at 1.76 million tonnes. The record high inventory is also due to the transportation hurdles caused by the bad weather conditions in northwest China.

According to Huatai Futures analyst Wu Xiangfeng, profits are expected for aluminium producers after losses since November 2017 due to capacity cut drives. This indicates that more aluminium capacities may come online in the first quarter of 2018, as no new policies are expected to limit production in the short term.

Alumina price increase would taper off after the Chinese New Year holiday in mid-February, lowering costs for aluminium producers and increasing profits. According to SMM, since the country is in the off season for aluminium demand, aluminium inventories are set to accumulate further. Average spot alumina price is slightly down to RMB 2872 per tonne. In the domestic markets, alumina is down at Central China and up in North, South and East China market.

The SHFE 1803 aluminium contract finished 2.9% lower at RMB 14,745 per tonne on Tuesday January 16.


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EDITED BY : BEETHIKA BISWAS 2MINS READ

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