Domestic social inventories continue to show a sharp decline, far exceeding expectations. The tight market supply flow has made aluminum prices slightly stronger. This month, aluminum prices have moved upwards, and Shanghai Aluminum’s main monthly increase has been 4.74%. Short-term policies and destocking are still positive. Aluminum prices have some support, but the fundamentals are not good. Under the accumulation of negative factors, it is necessary to be alert to the risk of aluminum prices surging down later; aluminum prices are expected to fluctuate within a narrow range in June, or the increase or slowdown, Lun Aluminum 1470-1590; Shanghai The main aluminum is 13-1.35 million; East China spot aluminum is 131-1.36 million; buy on demand.
1. Fundamental analysis
1. In terms of output
(1) China's primary aluminum output in April was 2.967 million tons, up 1.5% year-on-year
National Bureau of Statistics data show that in April 2020, the national electrolytic aluminum output was 2.967 million tons, with a cumulative output of 11.828 million tons, a year-on-year increase of 1.50% and a cumulative increase of 2.40%.
(2) Alumina output in April was 6.067 million tons
National Bureau of Statistics data show that in April 2020, the national alumina output was 6.067 million tons, a decrease of 3.2% year-on-year. From January to April 2020, the national alumina production totaled 22.995 million tons, a year-on-year decrease of 6.1%.
2. Import and export
(1) In April, about 414,000 tons of unwrought aluminum and aluminum products were exported
According to data from the General Administration of Customs, China’s exports of unwrought aluminum and aluminum in April were 441,177.1 tons. In the first four months of this year, the cumulative export of unwrought aluminum and aluminum products was 1,628,923.2 tons, a decrease of 15.9% from 1,936,337.8 tons in the same period last year.
(2) 72,000 tons of scrap aluminum imported in April
Customs data shows that in April 2020, imported scrap aluminum was 72,000 tons, a year-on-year decrease of 53.3% and a month-on-month decrease of 6.7%. From January to April, the cumulative import of scrap aluminum was 270,000 tons, a year-on-year decrease of 64.7%.
3. Inventory
(1) Lum aluminum inventory
Lum aluminum inventory in May continued the growth trend since late March. As of the end of May, LME aluminum inventory was 1493075 tons, an increase of nearly 150,000 tons from the end of April, an increase of 11%. The overseas epidemic situation continues to deteriorate, and market confidence is insufficient. It is expected that the short-term inventory of Lumen Aluminum will continue to grow.
(2) Shanghai Aluminum Inventory
Compared with the increase of Lumen aluminum inventory, domestic Shanghai aluminum stocks have fallen for the second consecutive month in May. As of May 22, Shanghai aluminum stocks were 322,060 tons, down 88,500 tons from the end of April. Domestic electrolytic aluminum social inventory (including SHFE warehouse receipts): 123,000 tons in Shanghai, 35.4 tons in Wuxi, 108,000 tons in Hangzhou, 51,000 tons in Gongyi, 180,000 tons in the South China Sea, 58,000 tons in Tianjin, 80,000 tons in Linyi, 18,000 tons in Chongqing, 110,000 tons in Chongqing The aluminum ingot stocks in the consumption area totaled 893,000 tons, down 86,000 tons from the previous Thursday.
Second, spot market analysis
1. Spot market
East China: Market confidence is picking up, and a series of stimulus policies are frequent. The aluminum price in May continued the upward trend in April, and the center of gravity shifted significantly. The spot aluminum in East China continued to move upward after exceeding 13,000, and the highest rose to 13,520 yuan/ton, as of On May 29, the price was 13440-13480 yuan/ton, up 660 yuan from the end of April, or a 5.2% increase. The price of the firm was firm, and the spot premium was once raised to 250 yuan.
In terms of market transactions: With the gradual increase in prices, traders are more active in transactions, frequent market entry operations, firmer sellers sell prices, spot supply is slightly tightened, downstream companies are more afraid of high sentiment, worried about price decline, wait and see or press Need to buy mainly, the overall market turnover improved compared with April.
South China: As of May 29, the price of aluminum ingots in South China was between 13810-13910 yuan/ton, up 620 yuan/ton from the end of March, an increase of 4.7%; in mid-May, the supply in the South China market was tight, and the spot was The high premium has subsequently declined, but it still maintains its premium status. Downstream companies have maintained their on-demand purchases and market activity has increased.
2. Scrap market
In May, the price of scrap aluminum continued to rise, and the price in southern China rose more than 500 yuan. At present, the price of organic aluminum is around 10,000, and the price of aluminum wire is around 12,000. The increase in other regions is slightly inferior, but it is still mostly 300-400 yuan. At present, the aluminum alloy spraying materials in East China are near 10200, the broken bridge material is near 9300, and the cans are near 8600; the price of 1 series aluminum scrap is between 15-87% off.
In May, the price picked up significantly, and the shipment sentiment of the holders improved significantly. The market supply of goods gradually increased, especially the supply of aluminum alloy materials, aluminum shavings, raw aluminum, etc., which increased significantly compared with April. However, relative to the downstream demand, the supply remained significant. On the tight side, the holders have a strong willingness to set prices, there are few sources of low-price goods in the market, and scrap aluminum has always been in a market that is easy to rise and fall. For downstream manufacturers, due to insufficient raw material inventory, manufacturers have a high enthusiasm for receiving goods, but the cost of raw materials is high. However, the prices of recycled aluminum alloys have not risen, and corporate profits have narrowed seriously. The overall transaction picked up in May.
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