LME aluminium to range at US$1,910-1,930/t; no further news of China aluminium output cut

LME aluminium ended last week marginally above US$1,900 per tonne. Rising by 0.15 per cent from its earlier close of US$1,898 per tonne, the light metal settled at US$1,901 per tonne on Friday, July 21. With no further news of aluminium output cut in China, LME aluminium is expected to hold ground at US$1,910-1,930 per tonne range on Monday, July 24, Shanghai Metals Market said. 

As on July 21, LME official cash buyer aluminium price (Bid Price) stands at US$1,900.50 per tonne, cash seller & settlement aluminium price (Offer price) is US$1,901 per tonne, 3M Bid Price is US$1,925.50 per tonne, 3M Offer Price is US$1,926 per tonne, Dec1 Bid Price is US$1,968 per tonne, and Dec1 Offer Price is US$1,973 per tonne. The current LME official Opening Stock of aluminium is estimated at 1354550 tonnes, total Live Warrant is 1059725 tonnes, and Cancelled Warrant is 294825 tonnes.

LME aluminium premiums remain unchanged across major global markets. As on July 21, LME aluminium premium for the US stands at US$170, LME Aluminium West-Europe Premium stands at US$80, LME Aluminium East Asia Premium remains unchanged at US$15, and LME Aluminium South-East Asia Premium is US$15 (per tonne).  

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SME and SHFE Aluminium Price Trend

The benchmark aluminium price at Shanghai Metal Exchange (SME) has edged higher from US$2,097 per tonne on Friday, July 21, to US$2,099 per tonne on Monday, July 24.

At Shanghai Futures Exchange (SHFE), the most active aluminium future contract SHFE 1709 aluminium got a big boost from the recent news of illegal aluminium capacity cuts in Shandong and Xinjiang; plus, the US dollar index was trending low. These factors along with positive China economic data helped buoy SHFE aluminium prices. SMM predicts that SHFE 1709 aluminium will continue to move at highs in the range of RMB 14,350-14,500 per tonne on Monday, July 24, as shorts will witness cautious trading.  

Spot aluminium in east China market is expected to trade at discounts of RMB 170-130 per tonne over SHFE 1708 aluminium on Monday.

The market focus will be manufacturing PMI from the US and the euro zone, US home sales and meeting between OPEC and non-OPEC countries on Monday, SMM said.