Recovery expectations move backward Shanghai aluminum continues to weaken

Overseas, since entering May, bauxite sea freight has continued to rise
.
Cape shipping costs from Guinea to China rose to around $33, up about
$6 from before May 1.
Panama shipping costs from Australia to China rose to $24-25, up about
$2 from the end of the month.
The cost of shipping (Cape) from Indonesia to China is about $14, up $2 from before May 1
.
According to SMM research, the operating rate of aluminum downstream leading processing enterprises last week fell by 7.
5 percentage points month-on-month to 57.
3%.

Domestically, 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 operation, and Tianyang Bai Mine, which began to be electrified before Labor Day.
From the perspective of new projects, the commissioning of Guangyuan Linfeng, Baiyinhua projects is also expected to be concentrated after
August and September.
In the first quarter of this year, the recovery of production capacity is more concentrated and rapid, but the curve of capacity increase in the later period will tend to flatten
.
According to customs data in April, the export volume of unwrought aluminum was about 596,900 tons, an increase of 0.
42% month-on-month and 36.
49% year-on-year, and the export volume of unwrought aluminum and aluminum products from January to April 2022 was 2.
2252 million tons, an increase of 29.
2%
from January to April last year.

In terms of stocks, as of May 9, domestic aluminum ingot stocks were 1.
03 million tons, down 03,000 tons
from the previous week.
As of May 9, LME aluminum stocks decreased by 0.
355 million tons from the previous session to 568,300 tons
.

Electrolytic aluminum social inventory decreased slightly month-on-month, by region, Gongyi area due to the early Xinjiang delivery restrictions, the arrival of small amount, began to arrive after the holiday, and last week because there were only 2 days of trading, shipments were limited, and it is expected that aluminum ingots will still arrive in Gongyi area in the later stage; In Wuxi, shipments were normal, while arrivals slowed down month-on-month and inventory declined weekly; In the Hangzhou area, due to the fact that some warehouses were closed in the early stage and could not be shipped, they were unblocked and resumed after May Day, so the inventory also decreased month-on-month; Overseas inventories fell to around 570,000 tonnes, a historic low
.

In terms of prices, the Fed raised interest rates, some economic data in the United States was less than expected, coupled with the news of balance sheet reduction and sanctions, the market panic and economic recession, the external non-ferrous metal under pressure, the domestic epidemic dependence, the policy adhere to the "dynamic zero" unwavering, overall, the domestic resumption of production momentum continues, the supply growth rate remains high, downstream consumption continues to be constrained, recovery expectations are moving back, short-term recommendations to wait and see thinking
.