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01 DECEMBER 2017 AL CIRCLE

LME aluminium breaks below support level; more weakness to follow

EDITED BY : DIPANWITA GUPTA 2MINS READ

A host of unconducive macroeconomic factors is driving LME aluminium price below its support level. The dollar index at 93.17 is edging higher on some progress being made in US tax reform, the effect of production reduction in China is still not getting reflected in downstream purchase behaviour, and raw material prices are falling across the board. As a result, LME aluminium which started at US$2,188 per tonne at the beginning of November is falling rapidly unable to hold grounds.

The light metal contract dropped from the previous day’s close of US$2,062 per tonne and ended at US$2,033 per tonne on November 30.

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LME Aluminium

As on November 30, LME official cash buyer aluminium price (Bid Price) stands at US$2,032.50 per tonne, cash seller & settlement aluminium price (Offer price) is US$2,033 per tonne, 3M Bid Price is US$2,050 per tonne, 3M Offer Price is US$2,052 per tonne, Dec1 Bid Price is US$2,100 per tonne, and Dec1 Offer Price is US$2,105 per tonne. LME aluminium Opening Stock or the LME aluminium inventory level stands at 1112025 tonnes, total Live Warrants is 892425 tonnes, and Cancelled Warrant is 219600 tonnes.   

SME and SHFE Aluminium Price Trend

The benchmark aluminium price on Shanghai Metal Exchange has inched higher from US$2,144 per tonne on November 30, to US$2,160 per tonne on December 1.  

In China domestic market, average aluminium price on Shanghai Futures Exchange (SHFE) is expected to move within the range of RMB 14,450-14,650 per tonne. SHFE aluminium price movement on November 30 is represented by SMM as below:

SHFE Aluminium

Whether more aluminium plants will slash production and up to what extent is yet to be confirmed. Till then, market participants are recommended to wait and watch.  

The economic calendar and data out for December 1 includes: German retail sales, German, Italian and European Union unemployment data, French, Italian and EU consumer price index (CPI), US initial jobless claims, personal income, spending, PCE prices, Chicago PMI, and US Federal Open Market Committee meeting, Reuters updates.

Tagged with:

Price LME Inventory

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EDITED BY : DIPANWITA GUPTA 2MINS READ

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