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SunSirs: Falling for 2 Consecutive Days, China's Aluminum Ingots Broke the Sideways Trend in September
September 25 2020 08:03:27SunSirs(Linda)

List of aluminum ingot prices

According to SunSirs data, the average domestic aluminum ingot market price was RMB 14,276.67/ton on September 24, which was a drop of 2.95% from the average market price at the beginning of the month (September 1) of RMB 14,710/ton; March 1) 14,553.33 yuan/ton, a decrease of 1.90%; compared with the average market price during the year (March 24) 11,230 yuan/ton, an increase of 27.05%.

In September, the price of aluminum ingots first fell and then rose. In the recent 2 days, they fell continuously, falling below the previous shock range (the shock range is 14500-14800 yuan/ton), and the sideways trend showed signs of breaking.

List of supply and demand in September

1. Social inventories continue to fall to support aluminum prices

In terms of social inventory: the social inventory of electrolytic aluminum continued to decline in September, a decrease of about 20,000 tons from the 755,000 tons at the end of August. According to statistics, on September 21, the domestic spot stock of electrolytic aluminum was 735,000 tons, compared with the domestic spot stock of aluminum ingots of 74 tons on the 17th. The social inventory of electrolytic aluminum (including SHFE warehouse receipts) totaled 755,000 tons, down by about 20,000 tons.

2. New additions and resumption of production capacity are expected to increase supply side heavy volume

Production capacity: With the gradual recovery of new electrolytic aluminum production capacity in Sichuan, Yunnan, Inner Mongolia and other places, as of mid-September, the national electrolytic aluminum operating capacity has risen to 37.75 million tons/year, and the completed production capacity is 42.88 million tons/year , The fourth quarter and the first quarter of next year, the supply side increased volume. 

3. Aluminum net imports for 2 consecutive months, aluminum prices are under pressure

In terms of import and export: China exported 395,000 tons of unwrought aluminum and aluminum products in August 2020, a year-on-year decrease of 15.2%. From January to August, the export of unwrought aluminum and aluminum products was 3.134 million tons, a year-on-year decrease of 20.3%. In August, China imported a total of 429,000 tons of aluminum, the highest level in more than 11 years, and was the second consecutive month of net aluminum imports.

Raw material alumina: 417,300 tons of alumina was imported in July, and a total of 2,327,200 tons were imported from January to July, a year-on-year increase of 341.2%.

Market outlook is expected

Aluminum prices have been running sideways for a long time, and the upward breakthrough is weak. This is mainly due to the current average profitability of domestic aluminum prices, the high enthusiasm for new production and re-production capacity, and the increase in domestic and foreign price differences, resulting in increased domestic supply pressure. Big. Fortunately, social inventory data shows that although the export market is still down significantly year-on-year, domestic consumption is good. Aluminum prices fell for 2 consecutive days this week, breaking through the sideways trend in September. The market outlook has intensified. SunSirs analyst believes that the recent base metals have been greatly affected by external prices. In addition, consumer demand during the traditional peak season of September has increased. The market expectation of oversupply in the market outlook has intensified, leading to an increase in market expectations for consumer demand, and consumer demand is less than market expectations, which will affect the recent price trend. It is expected that the price of aluminum ingots will be weak and stable in October, and the price range will be 13,500-15,000 yuan. /ton.

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