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03 NOVEMBER 2017 AL CIRCLE

Weak downstream consumption turns SHFE aluminium bearish; A00 ingot sees some rise today

EDITED BY : BEETHIKA BISWAS 2MINS READ

After the deep plunge yesterday, average prices of A00 aluminium ingot have seen some rise across all markets today on November 3. The price volatility is mostly attributed to slow downstream demand and growing stocks despite the winter capacity cut programme. Average A00 aluminium ingot price has climbed up to RMB 15,980/t today from RMB 15910/t.  The A00 ingot prices are expected to rise above RMB 16,000/t mark again.

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The rise in aluminium A00 Aluminum prices have continued in all other individual markets in China. A00 ingot prices have registered a drop from RMB 50/t to RMB 80/t across all markets. In the spot market aluminium is trading at a discount of RMB 120-80 /tonne.

As observed by Shanghai Metals Market, weak downstream consumption and uncertain production limit policy of Lvliang City have discouraged positive market sentiments in China turning SHFE Aluminium from bullish to bearish. Currently aluminium raw material costs are high giving support to aluminium, which will keep prices strong. Hence, bearish tendency at SHFE Aluminium is not expected to continue longer. In today’s night trading it may test below 60-day moving average and keep volatile around this average.  SHFE 1801 Aluminium opened at RMB 16,220/t after closing at RMB 16,265/t yesterday and trading at a range of RMB 16165/t to RMB16285/t.

Raw material prices are still unchanged across all major provinces in China. As updated by SMM, on Oct.29th, Indonesia Harita Group shipped its first 55,000 tonnes bauxite vessel to Shandong Lubei Enterprise Group after the ban had been lifted. CIF China price of bauxite of 12% silicon dioxide is about $54 per tonne. Up to end of October, Lubei Group has imported 400,000 tonnes  of Indonesian bauxite.


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EDITED BY : BEETHIKA BISWAS 2MINS READ

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