On January 3, the aluminum price fell 1.96%
According to the data of SunSirs, the average price of domestic aluminum ingots in the East China market on January 3, 2023 was 18,330 RMB/ton, a daily drop of 1.96%, and 5.03% lower than the aluminum price of 19,300 RMB/ton on December 1.
The aluminum price fell on the 3rd, mainly due to the slight increase in inventory in the East China market, the light spot trading, and the price cut and discount operations of the holders.
In the long term, the average price of aluminum ingot market was 17,450 RMB/ton at the beginning of the recent recovery (July 14, 2022), and the recent recovery was 5.04% higher. The recent high price of aluminum appeared on December 5. The average price of aluminum ingots in the market was 19,536.67 RMB/ton, and the current price fell by 6.18%.
Data fundamentals on January 3:
As of December 30, the total inventory of LME aluminum was 450,300 tons, 48,850 tons lower than the total inventory of 499,150 tons at the beginning of the month;
On January 3, the SHFE aluminum warehouse receipt increased by 7,925 tons to 40,666 tons;
On January 3, the social inventory of China's mainstream spot market was 559,000 tons, an increase of 62,000 tons compared with 497,000 tons of aluminum social inventory on December 8.
Negative logic of aluminum price on January 3:
Recently, the aluminum price fell back from a high level, mainly because of the expected downward movement of the downstream operating rate near the Spring Festival, and the news of a small recovery of production in Inner Mongolia, Guangxi and other places in the early period. The social inventory accumulation cycle was approaching, suppressing the aluminum price. Under the expectation that demand was weak and supply was relatively stable, social inventory data rose, the willingness of commodity holders to support prices moved down, and the willingness of middlemen to ship became stronger.
The weak expectation of downstream demand is mainly due to the fact that after the recent adjustment of public health policies in China, most domestic enterprises have a decline in the rate of job arrival, and the operating rate of downstream enterprises is not high; Near the Spring Festival, the downstream terminal demand is weakening, and some enterprises are considering taking holidays in advance, so the dual pressure depresses downstream demand. Downstream is in the off-season, demand is still weak, and orders in some regions are weak, the expectation turned to reality.
Market outlook
It is expected that the aluminum price will be dominated by weak operation in the short term.
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