Even a weak dollar index fails to support LME aluminium prices up

LME aluminium registered a sharp drop on Friday, April 28, defying a section of analysts’ outlook that indicated at a buoyant ending for the light metal last week. The contract closed at US$1,930 per tonne after Friday night trading, down 1.25 per cent from the previous day’s close of US$1,954.50 per tonne. The decline in LME aluminium prices was registered even though the US dollar index closed lower on Friday- the third weekly drop in a row.

Trend analysis suggests that the LME aluminium will continue trading at lows on Monday, May 1, and may regain some strength as the week advances.

As on April 28, LME official cash buyer price of aluminium stands at US$1,929.50 per tonne, cash seller & settlement price is US$1,930 per tonne, 3M buyer price is US$1,937 per tonne, 3M seller price is US$1,938 per tonne, Dec1 buyer price is US$1,973 per tonne, and Dec1 seller price is US$1,978 per tonne. The current LME official Opening Stock of aluminium is estimated at 1645375 tonnes, total Live Warrants is 991400 tonnes, and Cancelled Warrant is 653975 tonnes.

LME aluminium premiums, as on April 27, remain unchanged across major regions. LME Aluminium East-Asia Premium stands at US$110, LME Aluminium US Premium is US$215, LME Aluminium West-Europe Premium is US$95, and LME Aluminium South-East Asia Premium remains unchanged at US$15 (per tonne).

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The benchmark aluminium price at Shanghai Metal Exchange (SME) stands at US$2,038 per tonne as on April 28, Friday.

Aluminium futures contracts traded on Shanghai Futures Exchange (SHFE) suffered a nosedive during night trading on Friday, April 28. SHFE 1706 aluminium after opening at RMB 14,230 per tonne went down at RMB 13,990 per tonne because of short selling. Finally, the most traded April contract ended at RMB 14,015 per tonne. Consumption was clearly weak at the end of the week. SMM predicts that SHFE aluminium will test support at RMB 14,000 per tonne this week.