Today, SHFE aluminium futures fluctuated in the morning session after a significant pullback earlier. Near 10 am, the futures market surged rapidly, approaching RMB 20,000 per tonne. In the spot market, trading conditions differed between eastern China and central China.
Specifically, in eastern China, spot aluminium supply was relatively ample, and downstream restocking sentiment slowed slightly due to rising aluminium prices, making it difficult to achieve a premium. Early in the morning, the market traded SMM aluminium at a discount of RMB 10 per tonne to the average price. SMM A00 aluminium was reported at RMB 20,020 per tonne, up RMB 70 per tonne from the previous trading day, on par with the May contract, unchanged from the previous trading day.
In the central China market, after the market discount widened earlier, hedging traders were relatively active in purchasing. Coupled with downstream restocking demand ahead of the holiday, the market premium gradually improved.
With several consecutive days of stockpiling, inventory in central China continued to decline, and spot aluminium supply tightened during the day. Suppliers took the opportunity to raise premiums for shipments, and market trading activity was moderate. SMM central China A00 aluminium was recorded at RMB 19,960 per tonne against the SHFE aluminium 2505 contract, up RMB 90 per tonne from the previous trading day. The price spread between Henan and Shanghai was RMB 60 per tonne, narrowing by RMB 20 per tonne from the previous trading day. Actual market transactions were at a premium of RMB 10-20 per tonne against the SMM central China price and at a discount of RMB 60 per tonne against the 2505 contract.
On the inventory side, according to SMM's data on aluminium ingot inventory in three domestic regions, the total inventory of aluminium ingots in these three regions was 512,000 tonnes on April 29, a destocking of 15,800 tonnes from the previous day. In the short term, the downward space for premiums before the holiday is relatively limited.
However, after the holiday, as May approaches, downstream consumption is expected to weaken to varying degrees. It is anticipated that the destocking rate will slow down, and premiums will struggle to rise.
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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