In terms of consumption, the bright spots are limited, and aluminum prices are under upward pressure

At present, domestic aluminum inventory into the consumption season, aluminum social inventory from the previous Spring Festival holiday accumulation of 1.
66 million tons of storage around the current 680,000 tons, the recent destocking progress is better than market expectations, aluminum prices below the obvious support, the current alumina price is weak, electrolytic aluminum smelting cost is low, corporate profits are expected to make the later electrolytic aluminum production capacity resumption of production worries
。 In terms of basis, Shanghai nonferrous A00 aluminum premium 60-70 yuan / ton, with the recent electrolytic aluminum destocking progress is good, spot due to a small premium holders selling goods more active, downstream procurement progress is normal, on the basis of more balanced supply and demand, the recent basis maintained in the range of 50-150 yuan / ton is more
likely.

Aluminum market news:

1.
News on December 17, the monthly report released by the World Bureau of Metal Statistics (WBMS) on Tuesday showed that after calculations, in the first 10 months of 2019, the global primary aluminum market supply shortage was 298,000 tons, and the supply shortage for the whole year of 2018 was 667,000 tons
.
From January to October, global primary aluminum demand was 51.
92 million tons, down 750,000 tons
from the same period last year.
Primary aluminum production in the first 10 months was 317,000 tonnes
lower than the same period last year.
During October, LME inventories grew, mostly concentrated in Asian warehouses
.
Total stocks stood at 1.
753 million mt at the end of October 2019, compared to 2.
429 million mt
at the end of 2018.

2.
On December 16, Alcoa announced that it would permanently close its Point Comfort alumina plant
in Texas.
Alcoa World Alumina & Chemicals (AWAC), which owns the plant, is 60% owned by Alcoa and 40% owned by Alumina Limited
.
The plant, which has an annual capacity of 2.
3 million tons, was shut down in June 2016
.
In October 2019, Alcoa said it would evaluate
its global production capacity to reduce costs and sustainably make a profit.

Yesterday, Alcoa announced the permanent closure of one of its alumina plants, but the plant ceased production two years ago and did not cause new reductions to the market
.
This week, domestic aluminum ingots and aluminum rod inventories continued to degrade, aluminum ingot social stocks fell back to a low of 600,000 tons, and the volume of shipments continued to be higher than the same period of previous years, and the fundamentals had a marginal improvement in the short term, which supported aluminum prices in the short term
.
However, in the long run, electrolytic aluminum is planned to be put into production next year with a huge production capacity, the oversupply of raw materials and prices continue to decline, the profit scale of electrolytic aluminum continues to expand, giving short short profits the confidence, and in the context of the Spring Festival approaching, the destocking cycle of aluminum ingots is expected to end in 2-3 weeks, when the seasonal accumulation will be restarted, and the reverse structure of the contract also presents the market's
pessimism about long-term expectations.