The macro atmosphere is better, which boosts the general rise of non-ferrous metals today. Domestic housing policy is frequent, and the core consumer price index (CPI) in the United States in April showed the first cooling in six months, a sign that traders have increased their bets on future interest rate cuts by the Federal Reserve. Currently, the market is pricing in a more than 85% probability of a 25 basis point rate cut by the Fed by September.
Among them, Shanghai Aluminum rose more than 2.00% today, and closed up 1.42% as of the day. Alumina rose more than 3.00% today, and closed up 1.96% as of the day. In addition, the total inventory of domestic electrolytic aluminum by region and the total inventory of alumina ports have continued to destock recently, which has boosted aluminum prices to a certain extent.
Shanghai aluminum and alumina main trend:
Spot prices
Recently, the average spot price of SMM A00 aluminum has shown a fluctuating trend as a whole, and it is reported at 20,680 yuan/ton today, up 1.03% from the previous day. Since late April, the average spot price of SMM alumina has continued to rise, reporting 3719 yuan / ton today, up 0.13% from the previous day, floating red for 16 consecutive days, and an increase of 12.53% on the 16th.
SMM A00 aluminum and SMM alumina spot average price change trend:
Fundamentals
Supply side: In terms of alumina output, SMM data shows that China's metallurgical grade alumina output in April was 6.679 million tons, with an average daily output of 3,900 tons/day increased month-on-month to 222,600 tons/day, as of the end of April, China's alumina production capacity was 100 million tons, and the operating capacity was 81.27 million tons. It is estimated that the average daily output in May will be 224,300 tons/day, and the total operating capacity will be about 81.87 million tons, an increase of 3.5% year-on-year. According to SMM research, there are rumors in the market recently that some mines in Shanxi may resume production one after another, according to SMM's latest research, there is no actual resumption of production, the resumption of production progress or relatively slow, the actual increase in bauxite production remains to be seen, an alumina in Sanmenxia area resumed a production line in early May, involving an annual production capacity of about 500,000 tons, in addition, it is difficult to have a large increase in the supply of alumina in the short term in Jinyu region; An alumina plant in Shandong will end its roasting and maintenance in May, and the output may increase slightly in the month; There are still about 100,000 tons of production capacity in Guizhou to be restored, and the company reported that the progress of resumption of production depends on the supply of ore.
In terms of electrolytic aluminum output, according to SMM statistics, the domestic electrolytic aluminum output in April was 3.515 million tons, a year-on-year increase of 4.98%. In April, Yunnan maintained the resumption of production, driving the average daily output of the domestic electrolytic aluminum industry to increase slightly month-on-month at around 117,200 tons, and the proportion of molten aluminum in the industry in April increased by 1.4 percentage points month-on-month and 2.0 percentage points year-on-year to about 75.36%. According to the calculation of SMM molten aluminum proportion data, the domestic electrolytic aluminum ingot volume in April decreased by 2.77% year-on-year to around 865,900 tons. The output in May may reach about 3.64 million tons. In the future, it is still necessary to pay attention to the resumption of electrolytic aluminum production in Yunnan and the downstream start of aluminum water such as aluminum rods.
Changes in domestic alumina and electrolytic aluminum production:
In terms of bauxite, according to SMM research, as of now, the bauxite mines in Jinyu that have been suspended for some reason have not heard of the resumption of production, and the monthly output of bauxite has remained relatively low. Although there are rumors in the market that some mines in Shanxi may resume production one after another, according to SMM's latest research, there is no actual resumption of production at present, and the progress of resumption of production may be relatively slow, and the actual increase in bauxite production remains to be seen, and it may be difficult to have a large increase in May; The bauxite in Sanmenxia area of Henan Province has not heard of a clear expectation of resumption of production, and it is expected that the spot supply of bauxite in Jinyu will remain in short supply in May.
As of May 16, SMM statistics electrolytic aluminum ingots total social inventory of 747,000 tons, domestic tradable electrolytic aluminum inventory of 621,000 tons, compared with 31,000 tons last Thursday, 31,000 tons compared with this Monday, but the low level in the same period in the past seven years is no longer, and this Thursday's inventory is 7,000 tons higher than the total inventory of 740,000 tons in the same period last year. In terms of regions, the mid-week aluminum ingot depot was mainly due to Gongyi and Wuxi, both of which went to the depot more than 10,000 tons compared with Monday, and other consumption places also generally showed a small depot. The inventory on May 16 has decreased by 14.17% compared with March 25.
Recently, the arrival of aluminum ingots is relatively small, but the supply of goods in transit may increase slightly, and we should pay attention to whether there will be centralized arrival of aluminum ingots on weekends. Due to the continuous large losses in primary aluminum imports, it is difficult to turn losses into profits in the short term, and it is temporarily difficult for imported goods to flow into the market on a large scale, and the domestic aluminum ingot inventory may maintain a stable and small decline trend in the short term. In the future, it is necessary to pay close attention to the fluctuations of the supply side and the downstream consumption performance.
In terms of alumina, the inventory trend of domestic alumina enterprises has been relatively stable recently, and the inventory of alumina ports has continued to decrease since the end of March, and the inventory on May 16 decreased by 58.22% compared with March 22.
The total inventory of domestic electrolytic aluminum by region and the change trend of domestic and port alumina inventory:
Demand side: electrolytic aluminum, the operating rate of the downstream sectors is slightly polarized, entering May, many large manufacturers can maintain a high operating rate, but there are also some small and medium-sized manufacturers have stopped reducing production, and the overall performance of the demand side is flat.
In terms of alumina, in May, the domestic electrolytic aluminum operating capacity remained mainly rising, mainly due to the steady recovery of power supply in Yunnan and the steady resumption of production of remaining production capacity. SMM expects that Yunnan will have 350,000 tons/year of production capacity in May, and there is no major change in other regions. It is estimated that the domestic electrolytic aluminum operating capacity will increase by about 350,000 tons month-on-month to 42.97 million tons by the end of May.
SMM outlook
On the macro front, the U.S. employment data was relatively weak, the U.S. CPI fell as scheduled in April, and the monthly rate of retail sales in April unexpectedly fell; The new policy orientation of domestic real estate and new energy vehicles is conducive to the development of the real economy.
Fundamentals of electrolytic aluminum, due to the stable power supply in Yunnan, the resumption of electrolytic aluminum production continues, according to SMM research, the annual production capacity involved is about 350,000 tons. In addition, the domestic inventory of aluminum ingots and aluminum rods continued to go to the warehouse, but the inventory of aluminum ingots decreased by only 10,000 tons compared with the same period last year, and the year-on-year advantage was gradually exhausted, and the contradiction between domestic supply and demand may gradually become prominent. In the context of the overall macro sentiment, superimposed on the resilience of domestic downstream consumption, SMM expects that Shanghai aluminum prices will remain volatile in the short term.
In terms of alumina fundamentals, the domestic production on the supply side increased month-on-month or slightly, the supply of bauxite in Jinyu remained in short supply, and the operating capacity of electrolytic aluminum on the demand side was mainly improved. SMM believes that in the short term, alumina will be mainly connected or fluctuate at a high level. Pay attention to domestic macro policies, fundamental supply and demand, and inventory changes.