Expectations for a Strong March and April Support Suppliers Standing Firm on Quotes, While Downstream Purchases Remain Cautious [SMM Spot Aluminum Midday Review]

Feb 27, 2025, at 1:04 pm

[SMM Spot Aluminum Midday Review: Expectations for Peak Season Support Suppliers Standing Firm on Quotes, Downstream Purchases Remain Cautious] Inventory side, according to SMM domestic aluminum ingot social inventory data, as of February 27, it remained stable at 873,000 mt. Inventory stopped rising, coupled with expectations for future consumption recovery, spot prices stood firm, and short-term spot discounts may slightly narrow.

SMM, February 27 - In the early trading session, the SHFE aluminum front-month contract fluctuated upward, supported by market expectations of reduced in-transit cargoes and a consumption recovery during the "Golden March and Silver April" period, which bolstered sentiment to stand firm on quotes for spot aluminum. Specifically, trading activity in east China was active, and spot discounts remained flat compared to the previous trading day. Today, the SMM A00 aluminum ingot recorded a discount of 30 yuan/mt against the SHFE 2503 contract, with the SMM A00 aluminum ingot price at 20,550 yuan/mt, up 20 yuan/mt from the previous trading day. In the central China market, although inventory in the Gongyi region remains high, the concentration of cargo arrivals during the week, combined with expectations for "Golden March and Silver April," has led to a noticeable sentiment among suppliers to stand firm on quotes. From the perspective of processed material consumption, aluminum prices pulled back, prompting an increase in just-in-time procurement. However, new orders for March are expected to show limited YoY growth, and downstream enterprises remain cautious about raw material inventory turnover, showing low acceptance of the 20 yuan/mt premium in central China. Today, the Henan-Shanghai price spread recorded a discount of around 110 yuan/mt, with the SMM central China A00 aluminum ingot price at 20,440 yuan/mt, up 30 yuan/mt from the previous trading day. Regarding inventory, SMM data on domestic aluminum ingot social inventory showed that as of February 27, inventory remained stable at 873,000 mt. With inventory stopping its rise and expectations of future consumption recovery, sentiment to stand firm on quotes for spot aluminum has strengthened, and spot discounts may narrow slightly in the short term. Data source: SMM 》Subscribe to view SMM historical spot metal prices

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