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First, the fundamentals
First, the fundamentals1.
China's aluminum import production fell 38.
3% year-on-year in July, as domestic production rose to record levels and overseas supplies tightened
, according to data from the General Administration of Customs of China.
In July, China imported 192,581 tonnes
of unwrought aluminum and aluminum.
2.
According to data from the General Administration of Customs of China, from January to July, China's aluminum imports reached 1.
27 million tons of aluminum, down 28.
1%
year-on-year.
3.
According to data from the General Administration of Customs of China, in July, China imported 10.
59 million tons of bauxite, an increase of 12.
4% month-on-month and 14.
47%
year-on-year.
4.
Data show that in July 2022, China exported 652,100 tons of unwrought aluminum and aluminum products, and the cumulative export from January to July was 4.
1606 million tons, a year-on-year increase of 34.
9%.
5.
Sichuan's power rationing has been lifted, and electrolytic aluminum enterprises in the province have begun to resume production; Guizhou Yuanhao Aluminum (100,000 tons) is scheduled to be put into operation at the end of September 2022, and is expected to put 53,400 tons
into operation first.
Second, the market review
Second, the market review
Since August 2022, aluminum prices have fluctuated in the range, and the price once fluctuated and rose during the month, although it was slightly adjusted after sideways, but the overall price center of gravity has shifted
upward.
Represented by Yangtze River spot A00 aluminum ingots, the average price at the beginning of the month was 18280 yuan / ton, as of August 30, the average price of Yangtze River spot A00 aluminum ingots was 18550 yuan / ton, and the price rose by 680 yuan / ton, an increase of about 1.
48%.
On the macro front, the domestic LPR downward adjustment combined with real estate related policies is positive for construction aluminum, but the short-term impact on the downstream demand for aluminum is limited
.
The probability of the Fed's hawkish interest rate hike in September increased, the European economy was hit hard by energy, the German and French manufacturing PMI index in August continued to be below the 50th percentile line, which is not optimistic, and macro factors suppressed international commodity prices
.
On the supply side, due to the escalation of power tension in Sichuan and the limited impact of electrolytic aluminum production, almost all production capacity in the province has been stopped, totaling about 1.
2 million tons, accounting for about 2.
7% of the country's
total production capacity.
In addition, factories in Henan, Yunnan, Jiangsu and Zhejiang are also facing power cuts and production cuts
.
A number of Henan aluminum processing enterprises were forced to reduce production due to power cuts, and some small enterprises, on the one hand, were affected by power cuts, and on the other hand, due to the continuous high volatility of aluminum prices, directly chose to stop production
.
In the short term, domestic electrolytic aluminum production has decreased, and the pressure of oversupply has been suspended, which has supported prices
.
Therefore, it can be seen that the price of aluminum in the inner disk is stronger than that in the outer disk, and the contrast between the strength and weakness inside and outside is obvious
.
As the high temperature falls this week, the drought in Sichuan may ease, but it is still necessary to pay attention to the subsequent recovery of precipitation and hydropower in the southwest region
.
On the demand side, with the end of August, the traditional demand season
of "Golden Nine Silver Ten" has ushered in.
Some analysts said that the environment facing the "Golden Nine Silver Ten" market this year is generally better than that of the "Gold Nine Silver Four", which is conducive to supporting the stable and good operation
of the "Gold Nine Silver Ten" market.
On the whole, under the domestic macro policy, credit support and other aspects, the market has optimistic expectations
for the "golden nine silver ten" of downstream consumption.
In September, the temperature began to decrease, downstream processing enterprises may slowly resume production, coupled with the consumption off-season, processing enterprises' demand for aluminum may slowly improve
.
On the whole, if the demand performance in the peak season in September picks up significantly, or there is a phased mismatch between supply and demand, it will support the further rebound
of aluminum prices.
3.
Inventory
Inventory
According to data released by the London Metal Exchange (LME), London aluminum inventories continued to decline, falling to a new low of 271,450 tons in nearly 32 years on August 23, and Lun aluminum stocks increased by 10,625 tons on August 24, and then stocks fell again, and the inventory inflection point may not yet come, with the latest inventory level of 278,025 tons
.
Domestically, from the perspective of inventory levels, the social inventory of domestic aluminum ingot mainstream areas is relatively stable, the entire August aluminum ingot only accumulated 04,000 tons, at a historical low, although the recent accumulation of slightly, but July-August overall also showed 52,000 tons of destocking, which indicates that the current consumption is still strong
.
Fourth, the waste market
Fourth, the waste marketIn the week of August 26, scrap aluminum prices stopped falling and rebounded, and the increase in South China was mostly 200-300 yuan / ton, and the current local 6063 old material around 15100, aluminum wire around 16500, machine aluminum mainstream around 14200; Other regions rose more than 200-400 yuan, the current East China market aluminum alloy spraying old material mainstream around 14600, machine aluminum around 14400, cans around 12800, aluminum wire around 16700, all up from last week
.
In terms of finished products, the price of aluminum alloy ingots was raised by 300 yuan this week, and the current mainstream price of ADC12 in East China is around
18800.
In terms of the market, the current market shortage is more serious, the circulation of goods is small, the holders are willing to sell, the price of scrap aluminum is firm, some manufacturers have raised the price to receive the phenomenon, the price of raw aluminum has recently been raised, the manufacturers are not replenished, and the inventory of raw materials is generally not high
.
In addition, it is understood that the Chongqing area has been affected by power cuts, and most of the recycled aluminum smelting enterprises have carried out comprehensive shutdown measures, including Falin, Jiantao and other enterprises, which lasted about a week
.
Due to the tight power supply in some areas of Jiangsu and Zhejiang, the peak production of recycled aluminum plants has also occurred, and it is just
necessary to purchase scrap aluminum.
At present, the downstream market demand for recycled aluminum has not improved significantly, and the short-term fundamentals may have insufficient momentum for Shanghai aluminum to push up, but considering that the macro aspect of domestic price guidance will also intensify, it is recommended that holders can appropriately reduce the inventory and stop profit when the inventory is too high, and the growth rate of scrap aluminum may slow down
appropriately.
5.
Market outlook
Market outlook
On the whole, at present, there are production cuts on the supply side at home and abroad, and the easing of supply pressure supports aluminum prices
.
The aggravation of energy shortages in Europe, and the reduction or further expansion of local electrolytic aluminum production will have a certain impact
on the global supply and demand balance.
From the perspective of domestic fundamentals, the production capacity in Sichuan is almost completely stopped, a small amount of production in Chongqing is restricted, and the Sichuan-Chongqing region is facing certain supply pressure
in the short term.
Looking forward to September, if the demand performance in the peak season picks up significantly, or there is a phased mismatch between supply and demand, it will support the further rebound
of aluminum prices.
However, if demand continues to be sluggish, aluminum prices may remain range-bound
.
