US manufacturing rebounded more than expected in March as shown by an industry report released on Monday. The US dollar index rose on Monday as stronger-than-expected US manufacturing data offset sluggish retail sales. LME base metals closed mixed on Monday. LME aluminium dropped close to 1% and SHFE aluminium slid 0.3%.
US-China trade progress and stronger-than-expected China factory activity buoyed the three-month LME aluminium to a seven-day high of US$1,931 per tonne on Monday. The contract pared all those gains to finish the trading day close to 1% lower at US$1,892 per tonne as the US dollar index rose. LME official price stood at US$ 1888 per tonne yesterday, slightly lower than last week. As Rusal has resumed aluminium supplies to the US and the US dollar has registered a gain, both the factors are expected to weigh on LME aluminium to trade at US$1,890-1,910 per tonne today.
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As on April 1, LME aluminium cash (bid) price stood at US$ 1887.50 per tonne, LME official settlement price stands at US$ 1888 per tonne; 3-months bid price stands at US$ 1912.50 per tonne, 3-months offer price is US$ 1913 per tonne; Dec 20 bid price stands at US$ 2038 per tonne, and Dec 20 offer price stands at US$ 2043 per tonne.
The LME aluminium opening stock dropped to 1122825 tonnes. Live Warrants totalled at 723400 tonnes, and Cancelled Warrants were 399425 tonnes.
LME aluminium 3-months Asian Reference Price is hovering at US$ 1925 per tonne.
SME and SHFE Aluminium Price Trend
The benchmark aluminium price on Shanghai Metal Exchange increased slightly from US$2050 to US$ 2051 per tonne today.
As investors added longs and cut shorts amid robust Chinese manufacturing data and US-China trade hopes, the most-traded SHFE May contract climbed to a high of RMB 13,900 per tonne around noon on Monday. It ended 1.09% higher on the day at RMB 13,870 per tonne. A lower value-added tax effective yesterday drove spot offers into a discount of RMB 30-20 per tonne, against the SHFE front-month April contract. The most active SHFE May contract opened lower and fell overnight, closing 0.3% lower at RMB13,765 per tonne. It is expected to trade at RMB 13,770-13,870 per tonne today with spot prices at discounts of RMB 20 per tonne to premiums of RMB 20 per tonne.
Considering lower social stocks of primary aluminium over the weekend, SMM remains bullish on the downstream consumption in April and expects higher spot prices in the near term.
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