July 2020 cable raw materials (aluminum) monthly report

First, the fundamentals

1.
According to data from the National Bureau of Statistics, in June 2020, the national electrolytic aluminum output was 3.
015 million tons, with a cumulative output of 17.
889 million tons, a year-on-year increase of 0.
80% and a cumulative increase of 1.
70%.

2.
According to data from the National Bureau of Statistics, the national alumina output in June 2020 was 6.
293 million tons, with a cumulative output of 35.
202 million tons, a year-on-year decrease of 1.
80% and a cumulative decrease of 5.
10%.

3.
According to data from the General Administration of Customs, China's exports of unwrought aluminum and aluminum fell in June 2020, and China's exports of unwrought aluminum and aluminum products in June 2020 were 354,000 tons, down 30%
year-on-year.
In terms of value, China's exports of unwrought aluminum and aluminum products in June 2020 were US$924.
5 million, down 31.
2%
year-on-year.

4.
Customs data show that in June 2020, China's alumina exports were 32,300 tons, with a cumulative export of 97,500 tons from January to June, and 422,600 tons of alumina was imported in June, a new high
since February 2016.
From January to June, the cumulative import was 1.
9099 million tons, an increase of 487.
2%
year-on-year.
The net import of alumina in June was 390,300 tons, and the cumulative net import from January to June was 1,870,100 tons
.

5.
In June 2020, China imported a total of 10.
4382 million tons of bauxite, an increase of 9.
37% month-on-month and 17.
6%
year-on-year.
Among them, Guinea increased significantly year-on-month, importing a total of 5.
0262 million tons in June, an increase of 21.
67% month-on-month and 8.
09% year-on-year; Australia 3.
2412 million tons, Indonesia 1.
8979 million tons, the import volume of these three countries accounted for 97.
38% of the total; In addition, imports were 166,400 tons from Turkey, 55,700 tons from Solomon Islands, 50,800 tons from Ghana and 0.
002 million tons
from Guyana.

6.
China's primary aluminum imports in June 2020 were 123,500 tons, of which the import volume of tariff code 76011010 was 0.
0086 million tons, and the import volume of tariff code 76011090 was 123,400 tons
.
Primary aluminum imports in June 2020 increased by 574% month-on-month and 4060%
year-on-year in June.
From January to June 2020, the total import volume of primary aluminum was 162,300 tons, an increase of 390%
over the same period last year.

Second, the market review

This month's Shanghai aluminum price fluctuated, the overall trend was strong, spot twice exceeded the 15,000 mark, as of the end of the month, the main force of Shanghai aluminum closed at 14685 yuan / ton, up 6.
18% from the end of June; In terms of trend, the overall macro atmosphere is good and the continuation of destocking has certain support for aluminum prices to continue to rise, while the phenomenon of accumulation in the off-season has not yet appeared, and there is no obvious downward trend on the demand side, and aluminum prices may continue to run at a high level; However, due to the gradual rise in profits, the subsequent accelerated release of aluminum production capacity, the expectation of increasing supply is still there, in addition, the continuous inflow of imported aluminum ingots will also have a certain impact on aluminum prices; Overall, it is expected that the high price of aluminum in August will fluctuate, or there will be a slight adjustment, continue to pay attention to the marginal transformation of supply and demand and the accumulation of
stocks in the off-season.

This month, the center of gravity of Lun Aluminum continued to move upward, and after breaking through $1700 intraday, it stood firm, the highest rose to $1730, and as of the end of the month, the overall range of 1700-1740 oscillated, up 6.
6% from June; Overall, the current overseas macro situation is better, and the economic stimulus policies of various countries have played a certain role in boosting Lun Aluminum, but it is still necessary to pay attention to the follow-up progress of Sino-US relations, and it is expected that the trend of Lun Aluminum in August will fluctuate at a high level, with a range of 1680-1800 US dollars
.

In terms of the market, in the middle and early part of July, the market supply is relatively tight, the holder firm the selling price, the spot premium once as high as 300 yuan / ton, and then gradually declined, the market supply increased, but the current price is at a high level, downstream enterprises wait-and-see atmosphere is heavier, only buy on demand
.

East China: A series of stimulus policies in the EU boosted, and fundamentally, under the traditional consumption off-season, electrolytic aluminum accumulation inventory signs are not obvious, coupled with the support of many factors such as manufacturers' price control in the middle and early months, the center of gravity of Yangtze River aluminum prices in July continued to move up, the highest rise in the middle of the month to around 15350 yuan / ton, as the monthly price difference fell back, as of the end of July, the price of Yangtze River aluminum was between 14980-15020 yuan / ton, up 830 yuan / ton from the end of June, an increase of 5.
86%.

South China: As of July 31, the price of aluminum ingot tickets in South China was between 15190-15290 yuan / ton, up 730 yuan, or 5.
05%, from the end of June, slightly inferior to East China; In terms of market transactions, the market in South China is relatively abundant, but downstream enterprises are afraid of heights, and the transaction is mostly reflected in traders
.

3.
Inventory

As of the end of July, LME aluminum stocks were 1.
6431 million tons, an increase of 525 tons, or 0.
03%, compared with the end of June, and the growth rate slowed down
.
The continuous outbreak of the overseas epidemic still has a certain impact on market demand, and the inventory of Lun aluminum continues to be high, at the highest level
since May 2017.

Compared with the high inventory of Lun aluminum, the inventory of the domestic exchange continued to decline, due to the traditional consumption off-season in July and August, under the off-season factors, the downward trend of inventory slowed down significantly, as of July 24, the Shanghai aluminum inventory was 222,500 tons, down 1,217 tons, or 0.
54%,
from the end of June 。 Domestic electrolytic aluminum social inventory (including SHFE warehouse receipt): 118,000 tons in Shanghai, 21.
4 tons in Wuxi, 95,000 tons in Hangzhou, 37,000 tons in Gongyi, 182,000 tons in Nanhai, 58,000 tons in Tianjin, 5,000 tons in Linyi, 3,000 tons in Chongqing, and a total of 712,000 tons
in the consumption area of aluminum ingots.

Fourth, the waste market

July aluminum ingots rose more than 800 yuan, scrap aluminum prices are more obvious, especially in the first half of the year with the rise is more positive, the second half of the rise is slightly inferior, as of the end of July, South China market more than 500 yuan or so, the current local 6063 old material price is around 11350, machine aluminum price around 10500; East China is slightly inferior, and the variety difference is more obvious, the current local aluminum alloy spray coating price is around 10700, the price of cans is around 8700, pure can can be increased, 1 series of scraps in the Yangtze River aluminum price of about
84-85 discount.

In July, the scrap aluminum market basically continued the upward trend in June, and the variety difference was particularly obvious, scrap aluminum materials, aluminum wire, cans and other sources were more popular, but the unsold situation of machine aluminum has not improved, mainly affected by imported aluminum alloy ingots; In terms of manufacturers, aluminum rod and aluminum profile manufacturers have fair orders, large demand for raw materials, active procurement, and the current raw material inventory of manufacturers is more than in the previous period; Recycled aluminum ingot manufacturers mostly said that business is difficult to do, downstream finished product prices have stagnated, raw material prices have risen sharply, and profit margins have narrowed seriously
.
There is not much room for short-term scrap aluminum prices to rise or fall, and it is recommended that holders mainly ship at high prices to maintain low inventories and reduce risks
.

5.
Market outlook

At present, the overall macro atmosphere is good and the destocking continues to support the continued upward trend of aluminum prices, while the phenomenon of accumulation in the off-season has not yet appeared, and there is no obvious downward trend on the demand side, and aluminum prices may continue to run at a high level; However, due to the gradual rise in profits, the subsequent accelerated release of aluminum production capacity, the expectation of increasing supply is still there, in addition, the continuous inflow of imported aluminum ingots will also have a certain impact on aluminum prices; Overall, it is expected that the probability of aluminum price fluctuations in August is strong, or there may be a slight adjustment, it is recommended to continue to pay attention to the marginal transformation of supply and demand and the accumulation of stocks in the off-season, and the main focus of Shanghai aluminum is on the range of 1.
43-15,000
.