》Check SMM aluminum product quotes, data, and market analysis
SMM June 26 Report:
Today, the most-traded SHFE aluminum 2508 contract opened at 20,340 yuan/mt, with a high of 20,455 yuan/mt, a low of 20,325 yuan/mt, and closed at 20,445 yuan/mt. Trading volume was 152,000 lots, and open interest was 261,000 lots.
SMM Commentary: On the macro front, the marginal easing of the Middle East situation, coupled with the alleviation of concerns over shipping capacity in the Strait of Hormuz, has raised hopes for an end to the energy crisis, thereby weakening the cost support for aluminum. The intensification of trade friction between Europe and the US may suppress global industrial product demand and dampen expectations for aluminum semis exports. On the fundamental front, domestic aluminum smelter operating capacity remained stable, with the proportion of liquid aluminum remaining high, and the market supply of casting ingots remained tight. On the demand side, overall, most downstream sectors were in the traditional off-season. Downstream production cuts in central China were notably pronounced, with local spot transactions weakening and sustained large discounts appearing in market transaction prices. The weakening off-season demand in the PV and home appliance sectors cannot be ignored, with a significant pullback in the operating rates of related sectors. The wire and cable sector experienced a decline in operating rates due to the conclusion of the previous delivery period and high aluminum prices. In terms of inventory, no further supply replenishment was observed in inventory on Thursday this week, and it is necessary to continuously observe whether the destocking turning point has officially formed. Overall, the latest social inventory of aluminum ingots did not show further inventory buildup and remained at a low level, still providing support to the futures market. Medium-term macroeconomic policies (such as domestic consumption stimulus and expectations for US Fed interest rate cuts) may boost demand. It is expected that aluminum prices will fluctuate at highs in the short term, and subsequent attention should be paid to changes in inventory and demand.
Today, the most-traded alumina 2509 contract opened at 2,915 yuan/mt, with a high of 2,952 yuan/mt, a low of 2,915 yuan/mt, and closed at 2,948 yuan/mt. Trading volume was 325,000 lots, and open interest was 291,000 lots.
SMM Commentary: Last week, some alumina refineries completed maintenance and resumed production. Meanwhile, considering ore costs, there were new reports of production cuts. The operating capacity of alumina increased and decreased in parallel. Overall, the operating capacity of alumina decreased by 440,000 mt/year MoM to 88.57 million mt/year last week. Spot alumina supply remained loose, and the total inventory of alumina at aluminum smelters increased by 8,600 mt to 2.655 million mt last week. In the short term, the alumina fundamental front is expected to maintain a relatively loose pattern, and alumina spot prices are expected to drop back slightly. Subsequent attention should be paid to changes in the capacity and profitability of domestic alumina enterprises.
Today, the most-traded cast aluminum alloy 2511 contract opened at 19,700 yuan/mt, with a high of 19,750 yuan/mt, a low of 19,640 yuan/mt, and closed at 19,715 yuan/mt. Trading volume was 3,000 lots, and open interest was 8,000 lots.
SMM Commentary: On Wednesday, SMM ADC12 prices remained stable at 19,900-20,100 yuan/mt. Under continuous pressure from the traditional off-season, demand side remained weak with sluggish market transactions. Sluggish growth in end-user orders curbed the upward momentum of ADC12 prices, coupled with intensified market competition due to the influx of low-priced supplies. However, the relatively firm cost side provided some support to prices. As short-term consumption is unlikely to improve significantly and with the deepening impact of the off-season, ADC12 prices are expected to remain in the doldrums. Close attention should be paid to changes in raw material circulation and signs of marginal improvement in demand.
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