Aluminum prices have recently fluctuated to the downside, waiting for the market reversal node

On the macro front, the Fed decided to increase the US federal funds rate by 0.
5% (i.
e.
50 basis points) to reduce the high inflation rate
in the United States.
After the rate hike, the federal funds rate range increases to 0.
75% to 1%.

It was also the first time in 22 years that the Fed raised interest rates by 0.
5%.

At the same time, the Fed also announced that it will launch a balance sheet reduction program, reducing its balance sheet by $47.
5 billion per month from its $9 trillion balance sheet starting in June and $95 billion per month after three months
.

At present, the domestic electrolytic aluminum construction capacity is 43.
811 million tons, and the operating capacity is 40.
333 million tons, the increase is mainly reflected in
the two projects of Yunnan Hongtai, which is steadily put into production, and Tianyang Bai Mine, which began to be powered on before Labor Day.
In the first half of the year, the resumption plan of domestic electrolytic aluminum enterprises was basically completed, while Haiyuan Green Energy, Chinalco Liancheng and Heqing Yixin, Guangtou Yinhai and other projects due to overhaul of grooves and technological transformation, the release of production capacity should be postponed to the second half of the year
.
From the perspective of new projects, the commissioning of Guangyuan Linfeng, Baiyinhua projects is also expected to be concentrated after
August and September.
Therefore, from the perspective of supply, the recovery of production capacity in the first quarter of this year is more concentrated and rapid, but the curve of capacity increase in the later period will tend to be flat, and the average daily output of domestic electrolytic aluminum is expected to increase to more than
110,000 tons from May.

Coinciding with the "May Day" holiday, due to the epidemic caused by the incomplete lifting of transportation controls and the heavy task of stabilizing production and ensuring supply, some aluminum mills and traders in the northwest and downstream just needed to enter the market for stocking before the holiday.

However, the downstream stocking before the holiday is just demanded, the overall willingness to replenish storage is not strong, the market transaction is lower than expected, most of them are still dominated by executive long orders, and there are still big differences
between buyers and sellers on prices.
During the small holiday, the domestic alumina market traded coldly, and the price lacked clear guidance
.
On the first day of the return after the holiday, the market replenishment sentiment was relatively low, and the price of alumina in many places remained stable
.

In terms of inventory, domestic social treasury data showed a slight accumulation of inventory, and overseas stocks fell to about 570,000 tons, at a historical low
.
As of May 5, domestic aluminum ingot stocks were 1.
033 million tons, an increase of 46,000 tons
from the previous week.
LME aluminium stocks rose 0.
17 million tonnes from last week to 571,800 tonnes
.

Overall, the pace of resumption of production of electrolytic aluminum plants was faster than expected, and the concentrated arrival after May Day and the restart of inventory pressure
.
There are still insufficient orders for some downstream enterprises, and the operating rate of downstream enterprises has declined
during the May Day period.
Overall, the main pressure on aluminum prices at present comes from the weak atmosphere under the frequent outbreak of the epidemic, and aluminum prices may maintain a low level of consolidation, waiting for the aluminum market to reverse the node
.