China’s aluminium billet inventories plummet by 5,200 tonnes W-o-W to 116,300 tonnes

On Thursday, August 18, the aluminium billet inventories in China dropped by 5,200 tonnes W-o-W to settle at 116,300 tonnes, from 121,500 tonnes recorded last week. The inventory has increased in three major consumption areas and has decreased in two regions. The billets inventory stopped rising and began declining this week. Market participants are worried about the dryness during the rainy season and the probable recurrence of drastic production reductions caused by the power supply constraint that occurred last year.

The figure below provides further information on the current state of aluminium billet inventories in China:

Despite the weak market activity, the inventory in Changzhou, Huzhou, and Nanchang continued to rise. As per the SMM data, the inventory in Huzhou, Changzhou and Nanchang has grown by 2,000 tonnes, 2,300 tonnes and 1,100 tonnes, to rest at 17,000 tonnes, 6,500 tonnes and 3,200 tonnes.

Following continuous accumulation since July 18, the inventory in Foshan decreased this week, primarily due to fewer shipments from the Yunnan province and marginally stronger downstream consumption. In Foshan, the inventory dropped by 6,200 tonnes to settle at 75,400 tonnes from 81, 600 tonnes recorded last week.

In Wuxi, the inventory slumped by 4,400 tonnes to 14,200 tonnes from 18,600 tonnes last Thursday. However, because aluminium is so expensive, the demand has been restrained. The stock of aluminium billets is unlikely to increase the following week due to the slowing growth of the supply as a result of the accident's production slowdown and the power outages.