LME aluminium breaks above US$1,890 resistance, may gain further

LME aluminium finally broke above the resistance zone of US$1,890-1,892 per tonne and closed higher at US$1,899.50 per tonne after night trading on Monday, May 15. Shanghai Metals Market forecasts that the light metal traded globally will keep moving in the range of US$1,890-1,914 per tonne on Tuesday, May 16.

Reuters’ technical analyses show that there is a support below at US$1,880, a break below which could cause a loss in the range of US$1,862.50-1,871 per tonne; but macroeconomic indicators suggest the fall in that range is unlikely in the immediate short-term.

As on May 15, LME official cash buyer price of aluminium stands at US$1,899 per tonne, cash seller & settlement price is US$1,899.50 per tonne, 3M buyer price is US$1,904 per tonne, 3M seller price is US$1,905 per tonne, Dec1 buyer price is US$1,943 per tonne, and Dec1 seller price is US$1,948 per tonne. The current LME official Opening Stock of aluminium is estimated at 1545025 tonnes, total Live Warrants is 968375 tonnes, and Cancelled Warrant is 576650 tonnes.

LME aluminium premiums, as on May 12, 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) has risen at US$2,013 per tonne on Tuesday, May 16, up 0.19 per cent from the benchmark aluminium price of US$2,009 per tonne on Monday, May 15.

Aluminium futures contracts traded at Shanghai Futures Exchange (SHFE) recovered some lost ground on Monday. SHFE 1707 aluminium  after opening at RMB 13,875 per tonne rose to RMB 14,025 per tonne, but then fell back again to RMB 13,970 per tonnes due to active longs trading. May 15 was the deadline for the Chinese provincial governments to submit their results of illegal aluminium capacity checks. The news gave a boost to SHFE aluminium. SMM has it that SHFE 1707 will hover at RMB 14,000 per tonne on Tuesday, May 16.

China Aluminum International Trading Co. (Chalco Trading) raised aluminium prices it offered in major markets for the third consecutive day on May 16.  

The price details are as follows:

Unit: yuan/tonne 

Spot aluminium in China market is expected to trade at discounts of RMB 60-20 per tonne over SHFE 1705 aluminium contract on Tuesday, May 16, said SMM.