12 NOVEMBER 2013Platts
Aluminum inventories fall at China's SHFE warehouses: Chinese industry expert
Edited by : AL CIRCLE
2 min read
Refined aluminum inventories at Shanghai Futures Stock Exchange warehouses fell last week, as investors shift from aluminum to copper stocks, a Chinese industry expert said Monday.
Aluminum stocks at the Zhejiang, Jiangsu, Shanghai and Guangdong warehouses in China totaled 199,260 mt as of November 8, according to SHFE figures released that day. That is down by 11,055 mt from November 1, and also sharply lower from levels seen in early September, when stocks were recorded at 288,764 mt on September 6.
"Investors are transferring their capital from aluminum stocks to copper stocks," Jack Yeung, a business professor with City University of Hong Kong, said Monday. "The mainland Renminbi money supply is tightening with rising bank interest. This encourages copper hedging,"
"The London Metal Exchange aluminum price has been stabilizing at $1,800/mt since April 2013," he added. "This encourages the Chinese investors to sell more aluminum inventories."
Yeung noted that China's improved economic growth encourages copper consumption, investment and speculation -- increasing orders for the red metal.
China imported 406,708 mt of refined copper in October this year, up 26% year on year, customs figures showed.
Chinese metals consultancy Beijing Antaike forecast that domestic refined aluminum prices would face downward pressure in the second half of this year. In its H1 2013 aluminum industry report, released in the third quarter, Antaike estimated the SHFE 2013 average aluminum price would be Yuan 14,500/mt ($2,380), down 8% from 2012, thanks to the supply surplus seen globally and in the Chinese market.
Aluminum stocks at the Zhejiang, Jiangsu, Shanghai and Guangdong warehouses in China totaled 199,260 mt as of November 8, according to SHFE figures released that day. That is down by 11,055 mt from November 1, and also sharply lower from levels seen in early September, when stocks were recorded at 288,764 mt on September 6.
"Investors are transferring their capital from aluminum stocks to copper stocks," Jack Yeung, a business professor with City University of Hong Kong, said Monday. "The mainland Renminbi money supply is tightening with rising bank interest. This encourages copper hedging,"
"The London Metal Exchange aluminum price has been stabilizing at $1,800/mt since April 2013," he added. "This encourages the Chinese investors to sell more aluminum inventories."
Yeung noted that China's improved economic growth encourages copper consumption, investment and speculation -- increasing orders for the red metal.
China imported 406,708 mt of refined copper in October this year, up 26% year on year, customs figures showed.
Chinese metals consultancy Beijing Antaike forecast that domestic refined aluminum prices would face downward pressure in the second half of this year. In its H1 2013 aluminum industry report, released in the third quarter, Antaike estimated the SHFE 2013 average aluminum price would be Yuan 14,500/mt ($2,380), down 8% from 2012, thanks to the supply surplus seen globally and in the Chinese market.
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