September 2019 cable raw materials (aluminum) monthly report

First, the fundamentals

1.
According to data from the National Bureau of Statistics, the output of electrolytic aluminum in August was 2.
97 million tons, a slight decrease of 0.
3%
from the same period last year.
Average daily production of primary aluminum in August was about 95,800 tonnes, the lowest level since March and down from 96,260 tonnes
in July.
The decline in production was mainly due to the impact
of unexpected brief supply disruptions at two large smelters in August.

2.
According to data from the National Bureau of Statistics, the national alumina output in August 2019 was 6.
043 million tons, a year-on-year increase of 3.
5%, but a month-on-month decrease of 2.
9%; From January to August, the cumulative output of alumina in the country was 49.
883 million tons, a year-on-year increase of 5.
8%.

The decline in alumina production in August was mainly due to low alumina prices and environmental protection that led to production cuts at some smelters
.

3.
According to data from the General Administration of Customs, China's exports of unwrought aluminum and aluminum products in August 2019 were 466,000 tons, the lowest level since February, down 4.
3% from the previous month and 9.
9% from the same period last year, and the export volume of unwrought aluminum and aluminum products from January to August was 3.
936 million tons, an increase of 5%
from 3.
746 million tons in the same period last year.

4.
Customs data show that in August 2019, China's alumina imports were 120,000 tons, a year-on-year increase of 848.
4%, and the import amount was 360.
87 million yuan, a year-on-year increase of 367.
6%; From January to August, the import volume was 640,000 tons, a cumulative increase of 71.
8%, and the import amount was 216444 million yuan, a cumulative increase of 55.
4%.

5.
Customs data shows that China's total imports of aluminum scrap and scrap in August 2019 were 140,600 tons, a decrease of 1.
68% month-on-month and a year-on-year increase of 2.
63%.

The import approval is relatively loose at present, and the price of foreign scrap aluminum has certain advantages over domestic ones, and enterprises are still actively importing
.

Second, the market review

This month's Shanghai aluminum main shock decline, the beginning of the month by the rise of aluminum, and spot strong support, Shanghai aluminum main shock stable, market rumors Indonesia banned bauxite exports, by this news, Shanghai aluminum main force once pulled up to 14680, but the news to be confirmed, and Indonesia accounts for about 30% of China's bauxite imports, and then the plate fell rapidly, superimposed on China's August economic data is less than expected, the yuan fell, the dollar rose, in the fundamental unfavorable and dollar pressure, non-ferrous metals shock weakened
。 Intraday Shanghai aluminum main force lost 14,000 important mark, the lowest down to 13885, a new low since mid-August, from the trend point of view, macro uncertainty still inhibits the trend of aluminum prices, and the market destocking speed is slow, lack of actual favorable boost, aluminum prices have limited room to rise, it is expected that the overall performance of Shanghai aluminum in October will stabilize after the shock; the range is concerned about the 13800-14200 range
.

In terms of the external market, this month Lun aluminum first rose and then fell, at the beginning of the month by the weakening of the US dollar, and Sino-US trade optimism boosted, Lun aluminum intraday broke through the $1800 mark pressure level, the highest climbed to $1830, lack of substantial positive boost, obviously the pressure above the $1800 mark remains, and then the market waits for the Fed interest rate meeting, trading cautiously, Lun aluminum intraday again returned below $1800, although the Fed cut interest rates in line with market expectations, but the Trump impeachment event fermented, the dollar index soared continuously, Lun aluminum again came under pressure downward, and closed down continuously during the session, The lowest down to $1721.
5, a new low since January and October 2017; from the trend point of view, the trend of Lun aluminum is slightly weak, but after a sustained decline in the market, short-term does not rule out signs of stabilization, but the overall weak pattern remains unchanged, the following attention to the $1700 mark support; in addition, October 1-7 National Day holiday, domestic closed, normal trading of Lun aluminum, the news is flat, it is expected that the overall volatility of Lun aluminum in October is in the range of 1700-1820 US dollars
.

In terms of the market, the price fluctuations in September were relatively sharp, middlemen had room to operate, and they entered the market more actively, due to the impact of holidays such as Mid-Autumn Festival and National Day, downstream enterprises also increased their efforts to enter the market, but due to price instability, on-demand stocking was most, and the market transaction was slightly better than in August
.

East China, in the middle and early half of the year due to the easing of Sino-US trade relations and market rumors of Indonesia's bauxite export ban, aluminum prices continued to rise, but in the middle and late due to macro instability, and downstream consumption is not as expected by the market, electrolytic aluminum prices should fall, especially at the end of the month, the decline rate accelerated, overall, East China spot aluminum prices in September first rose and then declined, as of the end of the month price between 14010-14050 yuan / ton, down 260 yuan / ton
from the end of August.

South China, as of the end of September, South China aluminum ingot ticket price between 14290-14390 yuan / ton, down 270 yuan / ton from the end of August, the local market is abundant, traders are more enthusiastic to enter the market, it is understood that the local aluminum profile processing enterprise orders have improved, driving the market transaction, the current electrolytic aluminum inventory in the South China Sea has fallen to around
262,000 tons.

3.
Inventory

As of September 27, the total inventory of London aluminum was 914725 tons, down 12,275 tons, or 1.
32%, from the end of August; The "Golden Nine Silver Ten" consumption season, the peak season in September is not busy, hoping that consumption will improve in October, and the overall downward trend of aluminum will remain unchanged
.
As of September 27, the total inventory of aluminum on the Shanghai Exchange was 319,000 tons, down 43,000 tons, or 11.
87%, from the end of August; The trend of destocking is still obvious; Domestic social stocks, as of September 26, Shanghai area 179,000 tons, Wuxi area 283,000 tons, Hangzhou area 49,000 tons, Gongyi area 81,000 tons, South China Sea area 262,000 tons, Tianjin 54,000 tons, Linyi 08,000 tons, Chongqing 23,000 tons, consumption area aluminum ingot inventory total 939,000 tons
.

Fourth, the waste market

In September, the overall performance of the scrap aluminum market is still in short supply, the market supply is relatively tight, especially aluminum wire, scraps, types of materials and other high-quality sources, manufacturers into the market to find more goods, although the price of aluminum ingots has been reduced, but some enterprises due to shortage or even raised prices to receive goods, the high price of 1 series scraps can reach 85-86 discounts; The transaction of cans and machine aluminum has also improved, but due to purity problems, the price is still low, and the enthusiasm of manufacturers to receive goods is acceptable
.

In terms of environmental protection, at the end of September, due to the increase in environmental protection efforts in many places, affecting market transactions, Henan, Hebei, Shandong recycled aluminum enterprises shut down more, some areas even directly cut off electricity, in addition, transportation has also been affected to a certain extent, mainly because of the National Day parade blue
.

The market lacks actual benefits, macro instability factors are still there, aluminum prices are not enough to act, but scrap aluminum is currently in short supply, the price resistance attribute is strong, it is expected to stop the decline and stabilize after the holiday, recyclers are conducive to maintaining fast forward and fast out operations
.

5.
Market outlook

This month, Shanghai aluminum main shock decline, the lowest down to 13885, a new low since mid-August, from the trend point of view, macro uncertainty still inhibits the trend of aluminum prices, and the market destocking speed is slow, lack of actual favorable boost, aluminum prices have limited room to rise, it is expected that the overall performance of Shanghai aluminum in October will stabilize after the shock; The range focuses on the 13800-14200 range
.
"Golden Nine Silver Ten" consumption season, but the peak season in September is not strong, the market hopes that October demand will improve, October coincides with the National Day holiday, the news is flat, and the aluminum price is expected to stabilize
after the holiday.