Aluminum prices fell last week. The Shanghai Futures Exchange aluminum contract on Thursday reached 14295 yuan/ton after the speculative funds began to lock profit, then aluminum prices fell. The LME broke through 1950 US dollars/ton, but eventually fell below 1900 US dollars/ton line below.
As shown below, as of yesterday, the domestic spot market inventory exceeded 1000kt, compared with last week’s cumulative growth of 74.3kt. Compared with the same period last year, an increase of 97.7 thousand tons. In addition, in Xinjiang railway station inventory is at about 281kt, down 43kt last week. Spot inventory continues to grow, supply pressure is growing.
Unit：KT
| Area | 2016-3-6 | 2017-2-27 | 2017-3-6 |
| Shanghai | 308.4 | 208 | 217.1 |
| Guangdong | 204.7 | 241 | 302.5 |
| Wuxi | 309.3 | 342 | 358 |
| Hangzhou | 72 | 75 | 70.3 |
| Henan | 36 | 87.8 | 80.2 |
| Total | 930.4 | 953.8 | 1028.1 |
Demand level: the rise in aluminum prices stimulated traders speculation. In addition, this week, purchase order activity in Shandong, Jiangsu, Zhejiang and other places of the downstream aluminum processing enterprises rebounded from last week, boosting demand for aluminum. But in Beijing and Tianjin and the surrounding areas, the environmental protection inspections have not yet ended. The Northwest Inspection group also began last week, although not impacting electrolytic aluminum production, local downstream factories have been ordered to close.
On the whole, it is expected that next week, aluminum prices are bottoming out, the Shanghai Futures Exchange, the main contract aluminum prices 13600-14200 yuan/ton range first down after the rise, the international LME aluminum price 1850-1930 US dollars/ton consolidation.
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