Shanghai aluminum is strong and volatile, and the short-term upward pressure is still under pressure

Yesterday's aluminum prices were strongly volatile, mainly because an aluminum plant in Yunnan stopped production due to an accident last Friday and the effect of epidemic control gradually appeared, and market sentiment recovered
.
Domestic supply basically maintained stable operation, electrolytic aluminum production capacity slowed down, and the early production output continued to be released, but on Friday, an aluminum plant in Yunnan stopped production due to an accident, involving 370,000 tons of operating capacity, which slightly interfered
with supply.

In terms of cost, the price of Shanxi alumina fell back by 5 yuan / ton, mainly because the former Shanxi region was shackled by the epidemic, and the decline in transportation capacity led to the accumulation of alumina spot, and with the overall improvement of the epidemic situation, the transportation effectiveness quickly recovered
.

In terms of consumption, as the epidemic gradually improves, many automakers in Jiangsu, Zhejiang and Shanghai are gradually resuming work and production, which may stimulate the start and recovery of automotive aluminum processing enterprises
.

In terms of inventory, with the improvement of the epidemic and the support of policies for transportation, domestic social inventories were destocked within a week, and overseas stocks continued to decline to less than
540,000 tons.
As of May 16, domestic aluminum ingot stocks were 984,000 tons, down 19,000 tons
from last Thursday.
As of May 16, LME aluminum stocks fell by 0.
73 million tons from the previous session to 532,500 tons
.

Overall, the new resumption of production on the domestic supply side is still proceeding steadily, the production increment continues to be released, and the inhibitory effect of the epidemic on downstream consumption still exists, which limits demand under the traditional peak season, but from the performance of the week, the downstream replenishment demand after the price decline is good, orders have improved, coupled with the cost of stability, there is strong support
below the aluminum price.
Considering that the current incremental release of the market supply side is more certain than the demand on the consumer side, aluminum prices are still under pressure in the short term, and it is necessary to pay attention to the degree of improvement of the epidemic and the degree of downstream consumption recovery, and it is recommended to treat
it with a wait-and-see approach in the short term.