As of April 24, the mainstream price in the south China market — SMM A00 aluminum (Foshan) was at a discount of 345 yuan/mt against the 2605 contract, while the mainstream price in the east China market — SMM A00 aluminum was at a discount of 130 yuan/mt against the 2605 contract. The price spread between the two regions had exceeded 200 yuan/mt, covering sea freight, short-haul transfer, and logistics costs, officially opening up the transshipment window between Guangdong and Shanghai...

According to SMM data, as of April 24, social inventory of aluminum ingots in China's major consumption regions stood at 1.465 million mt, up 42,000 mt WoW, maintaining an inventory buildup trend for multiple consecutive weeks, with the pace of buildup widening again WoW. Weekly warehouse withdrawals rebounded slightly by 14,200 mt WoW to 115,200 mt, but the improvement in withdrawals fell short of the recent increase in arrivals, indicating clearly insufficient momentum for inventory drawdown..

[SMM Express] China's mainstream consumption areas saw secondary aluminum alloy ingot inventory increase by 297 mt from the previous day, with inventory buildup mainly concentrated in the Foshan area.

According to SMM statistics, as of June 16, the inventory of aluminum ingots at major domestic consumption areas stood at 458,000 mt, a decrease of 2,000 mt from last Thursday and a decrease of 19,000 mt from last Monday on a WoW basis. By mid-June, destocking of aluminum ingots in China slowed significantly this week. Driven by regional price spreads and inter-regional transfers, arrivals in east China's Shanghai, Wuxi, and central China's Gongyi areas increased notably over the weekend. Meanwhile, inventory in south China's Foshan area dropped sharply, while inventory in other domestic regions remained largely stable. SMM believes that supported by the still relatively low overall domestic casting ingot production in the short term, inventory is expected to continue its destocking trend. However, due to the slight increase in shipments from north-west China and inter-regional transfers driven by price spreads in recent days, the increase in arrivals this week has exerted significant pressure on east China and central China. Coupled with the expectation that some aluminum plants will increase casting ingot production, the tight supply situation may ease. Looking ahead, destocking in China as a whole is expected to face slowing pressure in the second half of the month. Close attention should be paid to whether the annual low of 440,000 mt can be successfully broken before the off-season transitions to an inventory buildup trend, in order to further boost market sentiment.

In terms of aluminum billet inventory, according to SMM statistics, the domestic aluminum billet inventory in major consumption areas stood at 127,500 mt on June 12, a decrease of 2,000 mt from Monday and a decline of 2,500 mt WoW, still hovering around 130,000 mt. In the past week, the regional distribution of aluminum billet inventory has shown divergence. In the Wuxi area, there was still an increase in warehouse arrivals, but poor market transactions exacerbated the local inventory buildup. In the Nanchang area, due to the persistently high Shanghai-Guangdong price spread, more billets were transported from the billet plants around South China to the Nanchang area, leading to an increase in local inventory, while arrivals in the Guangdong area were relatively low. In terms of outflows from warehouses, the total outflows from public warehouses of aluminum billets in China during the period from June 3 to June 8 amounted to 36,400 mt, a decrease of 1,200 mt from the previous period.

June 3 News: According to SMM statistics, on June 3, the inventory of aluminum ingots at major domestic consumption areas stood at 519,000 mt, an increase of 8,000 mt from last Thursday.

In terms of aluminum billet inventory, according to SMM statistics, as of May 29, the inventory of aluminum billets in major domestic consumption areas reached 128,300 mt, a decrease of 1,900 mt from Monday this week and a decrease of 2,500 mt WoW from Thursday last week. Despite signs of a slowdown in the destocking of aluminum billet inventory, the overall inventory still hovered around 130,000 mt, a low level compared to the same period in the past three years, indicating that inventory levels remained relatively low. From the perspective of outflows from warehouses data, the total outflows from warehouses of domestic aluminum billets during the period from May 20 to May 25 was 44,600 mt, a decrease of 4,900 mt WoW and a decrease of 7,300 mt YoY. Affected by the continuous impact of truck shipments, shipments showed little sign of improvement, indicating a significant weakening in the trading activity of the aluminum billet market and a growing off-season atmosphere. From a regional perspective, there was a gradual increasing trend in the arrival of aluminum billets in the Wuxi area, as manufacturers increased shipments to warehouses due to weakened downstream consumption. Meanwhile, the current Guangdong-Shanghai price spread had widened to 150 yuan/mt, and the price difference of "strong in the east and weak in the south" may promote the flow of aluminum billets between regions. It is necessary to continue to monitor the pace of changes in domestic consumption and the changes in the Guangdong-Shanghai price spread.

So, what was the actual situation of domestic aluminum ingot arrivals during the Labour Day holiday? According to SMM's latest statistics, the actual arrivals in the three regions during the holiday were approximately 56,000 mt, about 16,000 mt less than pre-holiday expectations and about 6,000 mt less than the same period last year. Specifically, the actual arrivals in Wuxi were 18,000 mt, in Foshan were 18,000 mt, and in Gongyi were approximately 20,000 mt, all lower than expected.

[SMM Analysis: Stainless Steel Scrap Supply Release Eases Shortage, Price Stops Rising and Pulls Back] This week, 304 stainless steel scrap off-cuts prices in east China first rose then fell, generally stabilizing at 10,200-10,300 yuan/mt; 304 stainless steel scrap off-cuts prices in Foshan area pulled back to 9,900-10,200 yuan/mt. Currently, by raw material calculation, the production cost of producing stainless steel entirely from stainless steel scrap is about 14,127.63 yuan/mt, while the production cost of producing stainless steel entirely from high-grade NPI is about 13,938.37 yuan/mt. This week, a steel mill in south China did not update its stainless steel scrap procurement price...

After the turning point of domestic aluminium ingot destocking became clear last week, this week’s domestic aluminium ingot inventory performance was disappointing, showing continuous slight accumulation.