Analysis of aluminum price trend in the domestic market in June

In terms of the market, the price fell in June, traders speculated on the dip, moved goods actively, and the market circulation was abundant, but downstream enterprises had obvious fear of decline, and the macro environment was unstable, and downstream enterprises mostly chose to take goods on demand
.
The weather has turned hot and entered the traditional consumption off-season, and it is expected that the transaction volume may decline
in July.

East China: The US dollar rebounded strongly, the Sino-US trade war rekindled, the cost of electrolytic aluminum continued to decline, the market was bullish, suppressing aluminum prices, aluminum prices rose in June without success, under pressure downward, spot aluminum ingots fell below the 14,000 mark, hitting a new low in recent times, as of the end of June, East China spot aluminum prices fell to 13960-14000 yuan / ton, down 630 yuan from the end of May, a decline of 4.
31%.

South China: As of June 29, the price of aluminum ingot tickets in South China was 14320-14420 yuan / ton, down 540 yuan from the end of May, down 3.
62%, the arrival of the South China market in June decreased, limiting the downward space of prices, the decline was slightly narrower than that in East China, downstream enterprise orders were relatively stable, more maintained on-demand delivery, the transaction was better than in East China, aluminum rods, the supply of aluminum rods was the main reason for the increase in processing fees since March this year, but the processing fees of aluminum rods in June were relatively stable, Maintain range-bound oscillation
.

As of June 28, Lun aluminum stocks were 1112025 tons, down 93,850 tons from the end of May, close to 1/3
of the beginning of 2016.
LME aluminum stocks are at a very low level, and the downward trend has been continuing
.
As of June 22, the Shanghai exchange aluminum inventory 941637 tons, falling for six consecutive weeks, down 32,075 tons from the end of May; In addition, as of June 28, Shanghai 429,000 tons, Wuxi 777,000 tons, Hangzhou 114,000 tons, Gongyi 170,000 tons, Nanhai 242,000 tons, Tianjin 58,000 tons, Chongqing 25,000 tons, Linyi 29,000 tons, consumption aluminum ingot storage totaled 1.
844 million tons, down 40,000 tons
from last week.
This month, social inventory has shown a downward trend for two consecutive months, and the total inventory has fallen below
2 million.
Although the domestic aluminum social inventory has continued to decline slightly in the past two months, the total inventory is still at a historical high
.
With the advent of the consumption off-season, it is expected that the downward trend of aluminum ingot inventories in July may slow down
.

Forecast for the future: The economic data released by the United States and Europe continue to be strong, the expectation of interest rate hikes continues to strengthen, and the expectation of global currency contraction continues to strengthen
.
Recently, the RMB has continued its rapid depreciation momentum, and the spread of worries about the domestic economic situation has led to the overall poor performance of domestic stock indexes and industrial products
.
From the perspective of domestic industry fundamentals, upstream production remains stable, raw material supply is sufficient, the midstream destocking process is steadily progressing, downstream aluminum production has declined significantly, export data has not yet been clearly affected, and the biggest negative comes from the continuous introduction
of national deleveraging policies for the real estate industry.
Under the background of the escalating Sino-US trade war, China's domestic financial deleveraging and real estate deleveraging, coupled with the traditional consumption off-season, non-ferrous metal prices are expected to continue to perform poorly
.
The price of aluminum in July is expected to fluctuate weakly, for reference
only.