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26 JULY 2018 AL CIRCLE

Sluggish consumption drives billet inventory hike in China four weeks in a row, while alloy price remains same

EDITED BY : DEBANJALI SENGUPTA 2MINS READ

According to the latest data by Shanghai Metals Market, aluminium billet inventory in China has extended growth over the week ended on July 26, amid low season and sluggish consumption. It has increased by 8,600 tonnes from 70,800 tonnes on last Thursday, July 19, and hovering at 79,400 tonnes across five major consumption areas. This marks a surge for the fourth consecutive week.

The inventory in Foshan and Guangdong has increased from 42,000 tonnes, as on July 19, to 47,400 tonnes on July 26, while in Wuxi and Jiangsu, the inventory has registered a hike from 5,600 tonnes to 11,000 tonnes. Other Chinese cities have recorded a slight tumble, compared to the previous inventory status on July 19.

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For more details, refer the chart below:

The average aluminium alloy (ADC 12) spot price, however, shows no change despite inventory hike across China. Since the beginning of the month, it is hovering at RMB 15,500 per tonne. The average price of aluminium alloy (A356), on the other hand, has recorded a plunge by RMB 50 per tonne to stand at RMB 14850 per tonne. Aluminium alloy (A380) price shows restraint as well, hovering at RMB 16300 per tonne over the month.

The below graph shows average price trend of aluminium alloy (ADC12):

As far as the primary aluminium inventory is concerned, all eight major Chinese markets, including SHFE warrants, have witnessed a plunge for the week ended on Thursday, July 26.

Inventory has lost 28,000 tonnes from last Thursday to stand at 1.8 million tonnes, according to SMM. Limited arrivals from the smelters have accounted for the drop.

The below chart shows the primary aluminium inventory status across all the major Chinese cities:


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EDITED BY : DEBANJALI SENGUPTA 2MINS READ

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