Driven mainly by pre-holiday restocking demand, and with the slower pace of arrivals since the second half of April, coupled with the temporary end of disruptions from imported supplies, the destocking of domestic aluminium ingot inventory accelerated again by the end of April, approaching the 600,000 tonnes mark, providing a certain degree of upward support for aluminium prices before the holiday.
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According to SMM statistics, as of April 30, the inventory of aluminium ingots at major domestic consumption hubs stood at 614,000 tonnes, down 29,000 tonnes from Monday this week, with a destocking of 44,000 tonnes W-o-W from Thursday, and a decrease of 177,000 tonnes Y-o-Y, remaining at a relatively low level compared to the same period in the past three years.
In terms of outflows from warehouses, despite a slight pullback W-o-W, the total outflows from warehouses of domestic aluminium ingots reached 138,800 tonnes in the past week (from April 21 to 27), with a M-o-M decrease of 3,300 tonnes in outflows from warehouses, but still remaining at a relatively high level for the year.
SMM believes that the domestic aluminium ingot inventory had successfully pulled back to around 600,000 tonnes by the end of April, which, to a certain extent, boosted market confidence ahead of the upcoming off-season. However, based on in-transit data and feedback from multiple sources, the Gongyi and Foshan regions will face relatively severe pressure from concentrated arrivals after the holiday, while the Wuxi region will experience relatively milder pressure.
SMM estimates that the total arrivals in the three regions during the Labour Day holiday will be approximately 72,000 tonnes, an increase of about 10,000 tonnes Y-o-Y. Specifically, the planned arrivals in Wuxi will be approximately 22,000 tonnes, a decrease of about 10,000 tonnes Y-o-Y; the planned arrivals in Foshan and Gongyi will be approximately 20,000 tonnes and 30,000 tonnes, respectively, each increasing by about 10,000 tonnes Y-o-Y.
SMM believes that the arrivals of domestic aluminium products during this year's Labour Day holiday may be higher than those of the same period last year. Attention should be paid to the risk of a temporary inventory buildup caused by concentrated arrivals after the holiday, which may also exert certain pressure on aluminium price performance after the holiday.
Note: This article has been issued by SMM and has been published by AL Circle with its original information without any modifications or edits to the core subject/data.
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