Futures: The most-traded cast aluminium alloy 2601 contract opened at RMB 20,930 tonne overnight, fell to a low of RMB 20,810 tonne, and finally closed at RMB 20,850 tonne, down RMB 140 tonne or 0.67 per cent from the previous close. Trading volume was 2,285, and open interest was 13,554. The price centre shifted lower in the short term, trading activity declined, and funds showed a clear wait-and-see sentiment as they exited the market. The KDJ indicator formed a death cross, with the J-line entering the oversold zone (11.73), indicating that short-term adjustment pressure remains, but there may be a need for a technical rebound. In the short term, the futures are dominated by technical correction and a wait-and-see sentiment among investors, with prices under pressure below the key 21,000 level; however, structural support from tight aluminium scrap supply on the cost side remains, with key support at 20,800 to be watched.
Spot-Futures Price Spread Report: According to SMM data, on November 17, the SMM ADC12 spot price was at a theoretical premium of RMB 635 tonne to the closing price of the most-traded cast aluminium alloy contract (AD2601) at 10:15.
Warrant Report: SHFE data showed that on November 17, the total registered volume of cast aluminium alloy warrants was 59,431 tonnes, an increase of 697 tonnes from the previous trading day. The breakdown by region was as follows: Shanghai (4,757 tonne, unchanged), Guangdong (18,881 tonne, up 577 tonne), Jiangsu (11,000 tonne, up 153 tonne), Zhejiang (19,659 tonne, up 480 tonne), Chongqing (5,014 tonne, unchanged), and Sichuan (120 tonne, up 120 tonne).
Aluminium scrap: On Monday, spot primary aluminium prices cooled rapidly compared to the previous trading day, with the SMM A00 spot price closing at RMB 21,630 tonne, and aluminium scrap market prices generally followed the decline. Baled UBC was quoted in the range of RMB 16,400-16,900 tonne (tax excluded), while shredded aluminium tensile scrap, priced based on aluminium content, was quoted in the range of 1RMB 7,800-18,300 tonne (tax excluded).
In Jiangxi, Hunan, Hubei, Henan, and other regions, prices were first lowered by RMB 100 tonne on Saturday based on futures movements, followed by another RMB 100 tonne decrease yesterday, resulting in a cumulative decline of RMB 200 tonne, fully reflecting the downward trend. It is expected that the aluminium scrap market will hover at highs next week, with the mainstream price range for shredded aluminium tensile scrap, priced based on aluminium content, likely fluctuating between RMB 17,800-18,600 tonne. Overall, the market will continue to experience a tug-of-war between sellers and buyers at high levels. It is recommended to closely track primary aluminium price trends, changes in environmental protection policies, and adjustments in downstream enterprises' procurement strategies, while remaining vigilant against the risk of a pullback from highs.
Silicon metal: On November 17, SMM prices in east China were as follows: non-oxygen blown #553 (RMB 9,300-9,400 tonne), oxygen-blown #553 (RMB 9,400-9,600 tonne), #521 (RMB 9,600-9,700 tonne), #441 (RMB 9,600-9,800 tonne), #421 (RMB 9,700-9,800 tonne), #421 for silicone use (RMB 9,800-10,200 tonne), and #3303 (RMB 10,400-10,600 tonne). Individual silicon prices in Tianjin edged down slightly. Silicon prices in Kunming, Huangpu Port, Sichuan, Shanghai, Northwest China, and Xinjiang held steady.
Overseas market: Current overseas ADC12 quotations held steady in the range of USD 2,600–2,620 per tonne, as domestic spot prices fell by RMB 200 tonne to RMB 20,600–20,800 tonne, coupled with a weakening RMB exchange rate, leading to expanded immediate import losses. Local ADC12 ex-tax quotations in Thailand were at 84–85 baht/kg.
Inventory: According to SMM statistics, the social inventory of secondary aluminium alloy ingots in mainstream domestic consumption areas stood at 51,800 tonnes on November 17, a slight increase of 900 tonnes compared to Thursday.
Summary: aluminium prices experienced a significant correction yesterday, with the SMM A00 aluminium spot price falling by RMB 280 tonne to RMB 21,920 tonne; in the secondary aluminium market, ADC12 prices also decreased by RMB 100 tonne to RMB 21,550 tonne. Today, secondary aluminium enterprises adopted a cautious approach to price adjustments, with most choosing to lower their quotations by RMB 100 tonne following the market trend, while a few maintained an optimistic outlook and kept their prices stable for the time being. Approaching year-end, overall market demand is optimistic, downstream consumption shows resilience, and with the correction in aluminium prices, restocking sentiment among some alloy enterprises has rebounded slightly. Overall, ADC12 prices are expected to fluctuate rangebound in the short term, with cost support remaining relatively solid. The tight supply situation for aluminium scrap is unlikely to ease soon, and raw material prices are more likely to rise than fall. Demand side exhibits certain resilience, coupled with low industry inventory, just-in-time procurement will provide a floor for prices.
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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