Aluminum prices slightly declined in January
According to the Commodity Market Analysis System of Shengyishe, as of January 31, 2024, the average price of domestic aluminum ingots in the East China market was 18980 yuan/ton, a decrease of 3.13% compared to the aluminum price of 19563.33 yuan/ton at the beginning of the month (January 1). Aluminum prices have almost unilaterally declined in the first half of the year. On the one hand, due to the approaching holiday, downstream processing enterprises have gradually weakened their production, and spot demand has decreased, leading to an increase in the proportion of ingots in the industry; On the other hand, due to the influence of aluminum oxide prices, aluminum prices fluctuate accordingly.
In the long term, the current price is in the “M” type price state since the second half of 2023, and the price level has been in the upper middle level in the past year.
Fundamentals of supply and demand
In terms of demand, due to the impact of the off-season of consumption, downstream production in China has continued to decline, and there has been no significant improvement in aluminum profile orders. Downstream demand for building profiles is weak, while the production of photovoltaic and automotive profiles in the industrial profile sector is stable.
There are signs of a turning point in social inventory within the month
In late January, social inventory shifted from being depleted on a weekly basis to accumulating on a weekly basis. As of January 29th, the mainstream social inventory of electrolytic aluminum ingots in China is 444000 tons, which is 421000 tons higher than the social inventory on January 22nd and has accumulated 23000 tons; On January 2nd, the social inventory was 446000 tons, and the social inventory in mainstream regions fell first and then rose during the month. Approaching the off-season of downstream demand (the aluminum processing industry is expected to be on holiday from the end of January to mid February), it is expected that demand may continue to weaken, and a turning point in social inventory may come in the short term.
However, social inventory is currently at a low absolute value, with year-on-year data showing a low level for the same period in nearly seven years.
Aluminum prices fluctuated horizontally in February
At the end of January, there were signs of stabilization in aluminum prices. On the one hand, this was due to the aluminum price falling below 19000 yuan/ton, stimulating downstream pre holiday stocking demand. On the other hand, the news about aluminum oxide was positive, and cost support was strengthened.
Inventory data may experience periodic accumulation in February. Currently, aluminum inventory is relatively low year-on-year, and the accumulation phenomenon is delayed and better than expected. At present, the inflow and storage of water in Yunnan during the dry season are better than in previous years, and the possibility of a second round of reduction in production of electrolytic aluminum in the local area has decreased. The long short game intensifies, and the short-term aluminum price fluctuates strongly.
| http://www.thiourea.net |