
The dollar fell but moved within narrow ranges yesterday. The dollar index slipped some 0.1% and finished at 98.22. Base metals closed lower across the board. LME aluminium slid 0.7%. SHFE aluminium lost 0.5%.
Three-month LME aluminium extended its declines overnight and fell to a low of US$1,774.5 per tonne, closing down 0.7% on the day at US$1,778.5 per tonne. The contract is likely to at US$1,700-1,800 per tonne today.
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As on August 22, Thursday, LME aluminium cash (bid) price stood at US$ 1738 per tonne, LME official settlement price stands at US$ 1739 per tonne; 3-months bid price stands at US$ 1766 per tonne, 3-months offer price is US$ 1766.50 per tonne; Dec 20 bid price stands at US$ 1848 per tonne, and Dec 20 offer price stands at US$ 1853 per tonne.
The LME aluminium opening stock dropped to 941350 tonnes. Live Warrants totalled at 656500 tonnes, and Cancelled Warrants were 284850 tonnes.
LME aluminium 3-months Asian Reference Price is hovering at US$ 1788 per tonne.
SME and SHFE Aluminium Price Trend
The benchmark aluminium price on Shanghai Metal Exchange (SME) has dropped to stand at US$ 2012 per tonne today from US$ 2025 per tonne on Thursday.
The most traded SHFE 1910 contract fluctuated to end the day marginally higher at RMB 14,340 per tonne yesterday. As shorts added their positions and longs exited, the October contract fell sharply after opening at RMB 14,355 per tonne on Thursday night, to lows of around RMB 14,270 per tonne and ended the trading day 0.56% lower at RMB 14,260 per tonne. Signs of domestic supply recovery are likely to keep the contract between RMB 14,200-14,300 per tonne.
A decline in operating capacity in Shandong and Xinjiang and the upcoming consumption pick-up will prevent downside in SHFE aluminium in the short term, but upside potential is hampered by higher inventories. SMM data showed that social inventories of primary aluminium ingots in China rose for a fourth straight week, gaining 12,000 tonnes in the week ended August 22.
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