LME aluminium is heading towards a volatile phase. With uncertainty brewing in the oil market due to souring political relationships among countries in the Middle East and North Africa (MENA), the light metal commodity is likely to experience a bumpy ride ahead. Saudi Arabia, Bahrain, Egypt and UAE announced to sever all kinds of diplomatic ties with Qatar on June 5, saying the nation supports terrorism. This should lead to transitory changes in the oil market dynamics which, in turn, may impact the commodity market.
LME aluminium closed at US$1,916.50 per tonne on Friday, June 5, down from US$1,930 per tonne on Thursday, June 1. According to Shanghai Metals Market (SMM) forecast, LME aluminium will continue to struggle around the moving averages and trade between US$1,920-1,940 per tonne on Monday, June 5.
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As on June 2, LME official cash buyer aluminium price stands at US$1,916 per tonne, cash seller & settlement aluminium price is US$1,916.50 per tonne, 3M buyer price is US$1,913.50 per tonne, 3M seller price is US$1,914 per tonne, Dec1 buyer price is US$1,938 per tonne, and Dec1 seller price is US$1,943 per tonne. The current LME official Opening Stock of aluminium is estimated at 1479725 tonnes, total Live Warrants is 1009850 tonnes, and Cancelled Warrant is 469875 tonnes.
LME aluminium premiums, as on June 1, have changed slightly. LME Aluminium East-Asia Premium stands at US$110, LME Aluminium US Premium has dropped to US$205, LME Aluminium West-Europe Premium is down at US$90, 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) stands at US$2,008 per tonne on Monday, June 5, down from the benchmark aluminium price of US$2,014 per tonne on Friday, June 2.
At Shanghai Futures Exchange (SHFE), the most active aluminium future contract SHFE 1707 aluminium opened at RMB 13,805 per tonne on Friday, June and then due to short selling shot up to RMB 13,875 per tonne. Then the contract started falling and closed at RMB 13,790 per tonne. SMM predicts that SHFE 1707 aluminium will continue to struggle at around RMB 13,800 per tonne in the short term. On Monday, June 5, it will trade in the range of RMB 13,770-13,920 per tonne.
Spot aluminium in east China market is expected to trade at discounts of RMB 60-20 per tonne over SHFE 1706 aluminium contract on Monday, June 5, SMM said.
China Aluminum International Trading Co. (Chalco Trading) has raised aluminium prices it offered in major China markets today. The prices are as follows:
Unit: yuan/tonne
The market focus will be on the LMCI in the US for May, US durable goods orders in April and factory orders due for release today.
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