SMM January 14 News:
In the morning session, the SHFE aluminum 2602 contract fluctuated upward, with the price center rising compared to the previous trading day. High aluminum prices suppressed downstream procurement demand, and overall buyer trading sentiment declined WoW from the previous trading day. Mainstream transaction prices were mainly concentrated at discounts of 300 yuan/mt to 20 yuan/mt. Today, the east China market selling sentiment index was 2.44, down 0.15 WoW; the purchasing sentiment index was 2.29, down 0.20 WoW. SMM A00 aluminum closed at 24,670 yuan/mt, up 370 yuan/mt from the previous trading day, at a discount of 80 yuan/mt against the 2601 contract, down 20 yuan/mt from the previous trading day; at a discount of 180 yuan/mt against the 2602 contract.
Today, trading sentiment in the central China market continued to recover. As the premium/discount range narrowed, trading firms engaging in both spot and futures market showed a significant increase in willingness to sell. Major holders sold off goods at low prices, but with high absolute aluminum prices, downstream processing enterprises maintained just-in-time procurement, and demand remained relatively weak. Traders held prices firm, and the actual transaction prices in the central China market ultimately remained between a discount of 20 yuan/mt to parity against the central China price, with a slight increase in trading volume. Today, the central China market selling sentiment index was 2.61, up 0.02 WoW; the purchasing sentiment index was 1.52, up 0.01 WoW. SMM central China closed at 24,510 yuan/mt, up 370 yuan/mt from the previous trading day, at a discount of 240 yuan/mt against the 2601 contract, down 20 yuan/mt from the previous trading day; at a discount of 340 yuan/mt against the 2602 contract. The Henan-Shanghai price spread was -160 yuan/mt, unchanged from the previous trading day.
Inventory side, on Wednesday, aluminum ingot inventory in major consumption areas increased by 3,500 mt WoW, with Wuxi being the main location for inventory buildup. In the short term, high aluminum prices may continue to suppress end-use demand, aluminum ingots still face inventory buildup risks, and spot premiums/discounts are expected to remain under pressure.
