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    Home > Chemicals Industry > New Chemical Materials > The upward driving force of aluminum prices is not obvious Beware of the risk of a high fall

    The upward driving force of aluminum prices is not obvious Beware of the risk of a high fall

    • Last Update: 2022-12-29
    • Source: Internet
    • Author: User
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    Last week, aluminum prices fluctuated higher, breaking through the previous high.

    Overall, the three major negatives that suppressed aluminum prices in the early stage, the margin gradually improved; Real estate policy gradually recovers, the epidemic gradually relaxes, the US CPI declines beyond expectations, and the market's expectation of a slowdown in the pace of interest rate hikes is gradually stronger, but in the medium term, metal prices are in the gap stage of the relay of the two variables of interest rate hikes and recessions, and after the interest rate hike suppression is eased, the price will still face the downward test of demand, but electrolytic aluminum still has the suppression of the supply ceiling, and after the gradual recovery of the economy, aluminum prices will still maintain a weak shock pattern
    .

    Aluminum prices

    On the supply side: transportation in some areas, especially in Xinjiang, has been affected to a certain extent, Xinjiang has a large volume, supply and consumption in some areas have been restricted to a certain extent, the number of asymptomatic infections in Guangdong has gradually increased, and aluminum production has declined slightly; Rumors of continued production cuts in Yunnan have affected production capacity by 20%-30%, and the power problem may not be alleviated, and the possibility of continued production cuts is not ruled out in the future; The resumption of production in the remaining regions and the release of new production capacity as planned, the overall supply may continue to rise
    .
    European electricity prices have reached a new high, which has a greater impact on the output of high-energy-consuming industries, if energy prices remain high, then European electrolytic aluminum production capacity may continue to decline
    in the future.
    The output of electrolytic aluminum in October was 3.
    459 million tons, +7.
    5% year-on-year and +5.
    1%
    month-on-month.
    Production is expected to grow at a rate of 1-2% in November
    .

    Demand: The marginal impact of the epidemic in Henan and Xinjiang has decreased, and the operating rate of plate, strip and foil remains at the high point
    of the year.
    The Federal Reserve has started the cycle of interest rate hike and balance sheet reduction, and the trend of overseas economic highs has been established, dragging down the overseas demand for electrolytic aluminum, but due to the conflict between Ukraine and Russia, the rise in energy prices has led to an amplification
    of the supply gap.
    Domestic demand still needs further efforts
    from the steady growth policy.
    With the expectation of overseas shortfall, the expectation of increasing the export of China's aluminum products in the later period has risen, and the current consumption is gradually recovering, and the demand for aluminum rods, plates, strips and foils has improved
    .
    In 2022, the amount of power grid investment will reach 550-600 billion, a record high, and this information will have a supporting effect
    on aluminum prices.

    In terms of inventory: last week's aluminum ingot inventory continued to destock, aluminum rods slightly accumulated, it is expected that next week aluminum ingots will still be slightly destocked, aluminum rod social inventory increased by 0150000 tons from last week, aluminum ingot social inventory decreased by 25,000 tons
    from last week.
    It is expected that the rhythm
    of destocking will continue in the future.

    In the short term, Shanghai aluminum by the improvement of macro sentiment, news real estate consumption to boost expectations and fundamentals of low inventory and other factors, prices have been boosted and a strong trend, but in the long run, the fundamentals are still in the context of supply and demand double growth, the current supply side has not heard the news of new production reductions, production capacity continues to recover, and demand performance is more general, policy stimulation real estate will slowly improve, but downstream demand will still experience a longer recovery process
    。 In addition, aluminum ingot social library still has a certain accumulation expectation, aluminum price upward driving force is not very obvious, if the recovery of high-frequency data of real estate demand is not as expected, the supply side will be reflected to the inventory through the form of accumulation, continue to put pressure
    on the plate.

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