Three-month aluminium closed 1.76% lower from the previous day; SHFE dropped for fifth consecutive day

The US dollar declined before recovered some losses on Wednesday, as fears over the coronavirus pushed investors into safe havens, while sterling rebounded after the Bank of England unexpectedly cut interest rates. The Standard & Poor's 500 Index plunged again on Wednesday, narrowly avoiding its first bear market since the financial crisis after the World Health Organization declared a global pandemic as the coronavirus rapidly spreads across the world.

Three-month LME aluminium relinquished gains from the previous session as it closed 1.76 per cent lower on the day at US$ 1,672 per tonne. The stock market panic is likely to keep base metals under pressure, with LME aluminium trading between US$ 1,640 per tonne and US$ 1,700 per tonne. 

As of Wednesday, March 11, LME aluminium cash (bid) price declined from US$ 1688.5 per tonne to US$ 1670 per tonne, while LME aluminium official settlement price inched down from US$ 1689 per tonne to US$ 1670.5 per tonne. 3-months bid price stood at US$ 1686 per tonne and 3-months offer price at US$ 1687per tonne. Dec 21 bid price hovered at US$ 1788 per tonne, while Dec 21 offer price at US$ 1793 per tonne.

The LME aluminium opening stock declined further to 1002300 tonnes from 1010025 tonnes on the previous day. Live Warrants continued to remain restrained at 797800 tonnes but Cancelled Warrants dropped from 212225 tonnes to 204500 tonnes.

LME aluminium 3-months Asian Reference Price inched down to US$ 1687.54 per tonne from US$ 1691.50 per tonne on March 10.

SHFE Aluminium Price Trend

Benchmark aluminium price for SHFE decreased for the fifth consecutive day today, on March 12, to stand at US$ 1831 per tonne.

The most-active SHFE 2005 contract eased to end at RMB 12,935 per tonne. SHFE aluminium is expected to remain weak in the short term as the coronavirus spreads outside China. The most-active SHFE contract is expected to be at RMB 12,800-13,050 per tonne today.