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11 JUNE 2018 AL CIRCLE

Alumina price in China declines on spot cargoes sell: Primary aluminium price & inventory plunge as well

EDITED BY : DEBANJALI SENGUPTA 2MINS READ

After a decline in two consecutive days last week, alumina spot price showed restraint today, June 11, at RMB 2904 per tonne, according to Shanghai Metals Market. On June 7, the alumina spot price plunged from RMB 2998 per tonne to RMB 2954 per tonne and on June 8, it fell to RMB 2904 per tonne.  

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Shanghai Metals Market believes that alumina spot price declined last week primarily because alumina producers as well as major traders in Shanxi and Henan began to sell spot cargoes. The slow pace of export shipments leaving the port in Guangxi also contributed to the fall of alumina spot price, as it increased the possibility of them being sold in the domestic market, which further suppressed domestic alumina prices.

SMM anticipates that alumina spot price is likely to face more pressure in the near future, as alumina producers began to ramp up their productions in the second half of the year.

Separately, SMM assessed Australian alumina fob price at $463/mt as of Friday, June 8, down $9/mt from a week ago. This followed a $3/mt drop during the preceding week. This suggests that international alumina price is approaching a rather reasonable level and we, therefore, see a limited downward room.

The average A00 aluminium ingot price, on the other hand, dropped from the previous day and closed at RMB 14720 per tonne, according to SMM. This marks a decline two days in a row after a sharp rise from RMB 14520 per tonne to RMB 14800 per tonne on June 7, 2018. Today, the prices are expected to rally within the range of RMB 14700 per tonne and RMB 14740 per tonne, with spot discounts to settle at RMB 50 to 10 per tonne.

However, China’s primary aluminium inventory that hovered at 1.98 million tonnes last Thursday June 7, dipped 30,000 tonnes further to stand at 1.95 million tonnes today, on June 11, 2018, including SHFE warrants. Despite torrential downpours in Guangdong province brought by tropical storm Ewiniar, overall inventory continued its decline over the weekend.

The current inventory status across the major Chinese markets is as follows:

 


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EDITED BY : DEBANJALI SENGUPTA 2MINS READ

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