Price correction takes LME aluminium below US$2,000/t mark

It is quite apparent now that the global aluminium market ex-China is moving toward a surplus. The expectations of tighter supply because of smelter capacity cutbacks in China seem to have started fading now as the cuts have been less than expected. In China, on the other hand, primary aluminium output kept rising. All these factors have led LME aluminium prices to correct over the last weeks falling below US$2,000 per tonne mark.

The light metal which closed at US$2,028.0 per tonne on Wednesday, December 6, dropped to US$1,994 per tonne on Thursday, December 7.  The price is expected to fluctuate in the US$1,900-2,000 per tonne range in the short term.

Source:www.lme.com

As on December 7, LME official cash buyer aluminium price (Bid Price) stands at US$1,993.50 per tonne, cash seller & settlement aluminium price (Offer price) is US$1,994 per tonne, 3M Bid Price is US$2,011 per tonne, 3M Offer Price is US$2,012 per tonne, Dec1 Bid Price is US$2,062 per tonne, and Dec1 Offer Price is US$2,067 per tonne. LME aluminium Opening Stock or the LME aluminium inventory level stands at 1097575 tonnes, total Live Warrants is 868375 tonnes, and Cancelled Warrant is 229200 tonnes.   

SME and SHFE Aluminium Price Trend

The benchmark aluminium price on Shanghai Metal Exchange remains fairly unchanged at US$2,105 per tonne on December 8.  

The price movement of aluminium on Shanghai Futures Exchange as on December 8 is updated by SMM as follows:

Today, on December 8, SHFE Aluminium is expected to keep volatile with the main contract ranging within RMB 14,100-14,350 per tonne. The spot premium will be at discount of RMB 120-80 per tonne, SMM said.