LME aluminium falls to a new monthly low; SHFE gains on alumina capacity cut news

The US dollar index traded at a week-high on Thursday as US Treasury yields traded near multiyear highs, on expectations of further interest rate hikes. That came despite US President Donald Trump's view that interest rate hikes have already gone too far. LME base metals ended in negative territory across the board on Thursday. 

While LME aluminium opened higher on Thursday, it fell to close near day-lows of US$2,008 per tonne, a new low in a month. It is likely to remain weak today with a trading range of US$2,000-2,030 per tonne.

As on October 18, LME aluminium cash (bid) price stands at US$ 2007 per tonne, LME official settlement price stands at US$ 2007.50 per tonne; 3-months bid price stands at US$ 2012 per tonne, 3-months offer price is US$ 2012.50 per tonne; Dec 19 bid price stands at US$ 2065 per tonne, and Dec 19 offer price stands at US$ 2070 per tonne. 

The LME aluminium opening stock dropped to 1072950 tonnes. Live Warrants totalled at 774775 tonnes, and Cancelled Warrants were 298175 tonnes.

LME aluminium 3-months Asian Reference Price is hovering at US$ 2039 per tonne.

SME and SHFE Aluminium Price Trend 

The benchmark aluminium price on Shanghai Metal Exchange increased to US$ 2027 per tonne today from US$ 2031 per tonne on October 18.

Some 8,000 lots of short positions entered the market in the afternoon, dragging the SHFE 1812 contract to an intraday low of RMB 14,015 per tonne. It rebounded near closing, and settled at RMB 14,140 per tonne. The contract then climbed to close near session highs of RMB 14,205 per tonne overnight, boosted by market talk that Jinjiang and Xinfa have cut their alumina capacity due to tight supplies of bauxite. While overnight gains helped the contract regain some previous losses, it still stood below the five-day moving average. The contract is likely to trade at RMB 14,100-14,250 per tonne today with spot discounts at RMB 50-10 per tonne.