Futures: Last night, the most-traded SHFE aluminium 2506 contract opened at RMB 19,550 per tonne, with a high of RMB 19,635 per tonne, a low of RMB 19,505 per tonne, and closed at RMB 19,635 per tonne, up RMB 65 per tonne, or 0.33 per cent, from the previous close. Yesterday, LME aluminium opened at USD 2,373 per tonne, with a high of USD 2,390 per tonne, a low of USD 2,352 per tonne, and closed at USD 2,388.5 per tonne, up USD 16.5 per tonne or 0.7 per cent.
Macro: (1) Fed Chairman Powell: Policy is in a good position, and we need to wait for clearer data before considering adjustments. Cryptocurrencies are gradually becoming mainstream, and related regulations are expected to be relaxed. Tariffs are likely to stimulate a temporary rise in inflation, and the impact may last for a long time. The current trend is that inflation and unemployment are rising together. Do not expect the Fed to intervene in the stock market's sharp decline. Trump's policies are constantly changing, and tariffs are higher than the Fed's highest estimates. It is understandable that the market is facing difficulties. (Bullish★)
(2) The Ministry of Commerce responded to "the US raising tariffs on certain Chinese goods to 245 per cent": The US has reached an irrational level in using tariffs as a tool and weapon, and China will not pay attention to it. (Bearish★)
(3) The US March retail sales M-o-M recorded 1.4 per cent, expected 1.3 per cent, the largest increase since January 2023. (Bullish★)
Fundamentals: (1) Aluminium ingot inventory: According to SMM statistics, on April 17, the domestic mainstream consumption area's aluminium ingot inventory was 724,000 tonnes, down 35,000 tonnes W-o-W from Monday, and down 55,000 tonnes W-o-W from last Thursday. (Bullish★★)
(2) Japanese port aluminium inventory: Japanese trading company Marubeni Corp. said that as of the end of March 2025, aluminium inventory at Japan's three major ports fell to 309,700 tonnes, down about 1.2 per cent from the previous month. Specifically, inventory in Nagoya and Yokohama fell to varying degrees, while inventory in Osaka rebounded slightly. The following is the aluminium inventory at Japan's three major ports since 2019: (unit: tonne) (Bullish★)
Primary aluminium market: Yesterday morning, the centre of aluminium prices moved slightly higher but remained in the doldrums overall, fluctuating around RMB 19,700 per tonne. In the spot market, after the centre of aluminium prices fell, spot trades improved, and downstream purchases increased slightly. After the contract rollover, market supply tightened, and traders took the opportunity to stand firm on quotes. The market traded at a premium of RMB 10 per tonne against the SMM A00 average price. SMM A00 was at a premium of RMB 10 per tonne against the SHFE aluminium 2505 contract, up RMB 10 per tonne from the previous trading day. SMM A00 aluminium ingot recorded RMB 19,680 per tonne, flat from the previous trading day.
Trading in the central China market improved during the day, and supply in the Shandong market was tight. Some downstream purchases were made in the central China market, and suppliers took the opportunity to stand firm on quotes. SMM Central China A00 recorded RMB 19,640 per tonne against the SHFE aluminium 2505 contract, up RMB 10 per tonne from the previous trading day. The price difference between Henan and Shanghai was RMB 40 per tonne. Actual market transactions were at parity to a premium of RMB 10 per tonne against the SMM Central China price, and at a discount of RMB 30 per tonne against the 2504 contract.
Secondary aluminium raw materials: Yesterday, spot aluminium prices were flat from the previous trading day, with SMM A00 spot closing at RMB 19,680 per tonne. The aluminium scrap market saw little overall price change yesterday, and downstream demand did not show a clear peak season trend, maintaining purchasing as needed. Yesterday, baled UBC was quoted at RMB 14,800-15,400 per tonne (excluding tax), and shredded aluminium tensile scrap was quoted at RMB 15,850-17,350 per tonne (excluding tax).
In the short term, the circulation of aluminium scrap, especially aluminium tensile scrap, remains tight. Although downstream scrap utilisation enterprises generally have low operating rates, basic demand persists, providing support for aluminium scrap prices. In the short term, aluminium scrap prices may fluctuate rangebound with primary aluminium, and the price difference between A00 aluminium and aluminium scrap will mainly adjust rangebound.
Secondary aluminium alloy: Yesterday, aluminium prices remained stable, with SMM A00 aluminium price flat from the previous trading day at RMB 19,680 per tonne. Secondary aluminium plants also mainly quoted stable prices, with domestic SMM ADC12 prices maintained in the range of RMB 20,500-20,700 per tonne. Current downstream demand remains sluggish, providing weak support for prices. It is expected that secondary aluminium alloy prices will continue to fluctuate in the doldrums in the short term.
Summary: On the macro front, yesterday, the US White House imposed a 245 per cent tariff on certain Chinese goods, and China stated that it would not pay attention to it. Although the market is concerned, there is no sign of panic spreading. Recently, due to the disturbance of tariff events, US inflation and unemployment have risen together. Under dual pressure, Fed Chairman Powell stated that he needs to wait for clearer data before considering the next interest rate cut, and the monetary policy outlook is unclear.
On the supply side, although the operating capacity of aluminium increased in April, the domestic capacity ceiling limits significant growth. Weekly aluminium ingot inventory fell sharply by 35,000 tonnes, and the acceleration of destocking continues to provide strong support for the bottom of aluminium prices. On the demand side, there is a wait-and-see sentiment in the market due to the impact of tariffs, but after the decline in aluminium prices, new orders from end-users increased slightly, and the purchasing power of processing enterprises rebounded.
Aluminium outflows from warehouses performed well. In summary, the rebound in non-ferrous metals is supported by easing macro sentiment, and the continued destocking of aluminium supports aluminium prices. In the short term, aluminium prices will maintain a fluctuating trend, and subsequent attention should be paid to tariff policy adjustments and the export situation of aluminium semis and end-users.
Note: This article has been issued by SMM and has been published by AL Circle with its original information without any modifications or edits to the core subject/data.
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