LME aluminium falls as stocks return to growth, a brief rebound expected shortly

LME aluminium fell from US$1,889 per tonne to US$1,865.50 per tonne after night trading on Wednesday, June 21 as aluminium stocks returned to growth. Unable to hold ground, the light metal shed 1.2 per cent of its brief gain. Shanghai Metals Market forecasts that LME aluminium will fall further to US$1,862-1,878 per tonne on Thursday, June 22, as supply remains strong.

However, Reuters’ technical analysis suggests that aluminium prices on LME may bounce to US$1,885 per tonne in the short term as the contract failed to break a support zone of US$1,862.50-US$1,871 per tonne. A further drop from the current level is likely to be limited to US$1,862.50 per tonne.  

As on June 21, LME official cash buyer aluminium price stands at US$1,864.50 per tonne, cash seller & settlement aluminium price is US$1,865.50 per tonne, 3M buyer price is US$1,873 per tonne, 3M seller price is US$1,874 per tonne, Dec1 buyer price is US$1,907 per tonne, and Dec1 seller price is US$1,912 per tonne. The current LME official Opening Stock of aluminium is estimated at 1440875 tonnes, total Live Warrants is 1058625 tonnes, and Cancelled Warrant is 382250 tonnes.

LME aluminium premiums, as on June 20, remain unchanged across major regions. LME Aluminium East-Asia Premium stands at US$110, LME Aluminium South-East Asia Premium remains unchanged at US$15, and LME Aluminium West-Europe Premium is at US$85, and LME Aluminium US Premium is at US$195 (per tonne).

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The benchmark aluminium price at Shanghai Metal Exchange (SME) stands at US$2,011 per tonne on Thursday, June 22, down 0.34 per cent from the benchmark price of US$2,018 per tonne on June 21.

At Shanghai Futures Exchange (SHFE), the most active aluminium future contract SHFE 1708 aluminium is expected to move at RMB 13,810-13,980 per tonne on Thursday, June 22.

Spot aluminium in east China market is expected to trade at discounts of RMB 120-80 per tonne over SHFE 1707 aluminium contract on Thursday.

China Aluminum International Trading Co. (Chalco Trading) again cut aluminium prices it offered in major markets today after the sharp hike in previous two consecutive days. The revised prices are as follows:

Unit: RMB per tonne

The market focus will be on the initial jobless claim data of the US for the week ending June 16, fresh reading of eurozone’s consumer confidence index in June, UK’s Brexit negotiation and US Federal Reserve official Jerome Powell’s address on Thursday, SMM said.