South China aluminium market under pressure for two varieties, trading in the doldrums amid a tug-of-war between sellers and buyers

For aluminium ingots in South China, SMM A00 aluminium (Foshan) was quoted at RMB 24,690 per tonne on Jan. 14, soaring RMB 380  in a single day, at a discount of RMB 60 per tonne against the front-month contract. With prices hitting new highs, suppliers showed a stronger willingness to cash out, coupled with hedging positions offloading cargoes amid bearish expectations on the spot-futures price spread. 

The quotation range was -RMB 30 to -10, indicating a relatively loose market supply. Downstream buyers were unable to chase higher prices, leading to weak procurement. Traders shifted from a wait-and-see stance to restocking at discounts, partially making up for the demand gap and supporting weak but stable transactions. Later, futures price fluctuations drove quotations to adjust between -RMB 60 and +80, with buyers only favouring low-priced sources. Spot transactions were centred around RMB 24,690 per tonne.

For aluminium billets in South China, on Jan. 14, the average price of SMM 6063 aluminium billet (Guangdong) Φ90 per 100 was -RMB 120, and Φ120 and above specifications averaged -RMB 170. 

The sharp surge in the base price triggered strong fear of high prices among downstream buyers, with bargaining and price-pushing behaviours becoming prominent. Processing fees continued to hit bottom. Although intraday futures price increases provided some support, demand-side improvements remained weak. The market lacked effective transaction support, and overall trading fell into a difficult situation.

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.