SHFE aluminium price heightens by US$13/t; LME aluminium market stays closed on May 6

The Shanghai Futures Exchange (SHFE) aluminium benchmark price has inched up by US$13 per tonne or 0.45 per cent on May 7, halting at US$2,864 per tonne. 

Overnight, the most-traded SHFE 2406 aluminium contract opened at RMB 20,720 per tonne, with the highest and lowest prices at RMB 20,830 per tonne and RMB 20,705 per tonne before closing at RMB 20,730 per tonne, down RMB 15 per tonne or 0.07 per cent. 

SHFE 2307 aluminium added RMB 595 per tonne or 3.38 per cent to RMB 18,185 per tonne. The open interest fell 11,785 lots to 256,640 lots.

China’s domestic aluminium market is experiencing a balance between bullish and bearish factors. Bauxite supply is tight, and ore prices are solid, leading to rising alumina prices and increased aluminium costs. Demand is better than expected, but high aluminium prices are suppressing downstream consumption. The debt ceiling negotiations in the US have failed to reach an agreement, adding to macro uncertainty. The US Fed is undecided on whether to raise interest rates or not. Falling prebaked anode and coal prices are weakening cost support to aluminium prices. It remains to be seen whether SHFE aluminium will fall below RMB 18,000 per tonne in the short term.

London Metal Exchange Market 

The LME aluminium price refrained from any change, staying fixed at US$2,517 per tonne as was recorded on May 3, as the market was closed on May 6.