Shanghai aluminum maintained a narrow range of volatility, and the price center of gravity fell to a limited extent

From a fundamental point of view, due to the delay in the resumption of work of downstream enterprises, social inventory has accumulated, but over time, the impact of the epidemic on downstream enterprises will gradually weaken, downstream trading will gradually return to normal, and the Shanghai aluminum index will oscillate to build a bottom
in the short term.

In terms of inventory, as of February 14, the previous aluminum inventory was 338848 tons, an increase of 36,133 tons
from the previous week.
Among them, futures inventories were 167722 tons, an increase of 65,197 tons
from the previous week.
In terms of social inventory, according to the survey results of Aizai Consulting, as of February 12, the total inventory of aluminum ingots in domestic aluminum smelters was about 437,500 tons, an increase of about 207,700 tons over previous years, an increase of 90.
4%.

It is worth noting that, first, the 437,500 tons counted are all aluminum ingot inventory, and the backlog of other primary processing products such as aluminum rods, aluminum rods, round ingots and flat ingots cast by some manufacturers during the Spring Festival is also very serious; Second, the inventory of statistics is not all unsold aluminum ingots, a large part of which has signed long orders, but because of poor transportation, aluminum ingots cannot be shipped out, so there is a backlog
in the factory.

From the perspective of the degree of impact, Guizhou, Sichuan, Chongqing, Guangxi, Shaanxi and other places were mainly transported by automobile in the past, so the transportation was greatly affected, and the inventory of aluminum ingots in the factory area increased
by a large proportion compared with previous years.
In addition to the factory inventory, aluminum ingots in transit also account for a large proportion, but aluminum ingots in transit have always existed even after the resumption of transportation, so do not give too much consideration for
the time being.
At present, the social stock has approached 1.
1 million tons, and the full recovery of downstream construction materials has been delayed until the end of February, and the accumulation of inventory will put pressure on
aluminum prices.
Although inventories are now increasing, it is worth noting that the epidemic has also affected
the production of alumina companies.
As of February 14, according to statistics, the total production capacity reduced due to the epidemic around the Spring Festival has reached 2.
95 million tons
.
Alumina is the main raw material for the production of electrolytic aluminum, and alumina production capacity will be affected, and aluminum prices will be supported
to a certain extent.

According to the statistics of the National Health Commission, on February 14, there were 221 new confirmed cases in areas other than Hubei, showing a downward trend for the 11th consecutive day, indicating that the epidemic situation in most provinces except Hubei has been well controlled, which is beneficial
to the resumption of work downstream.
As far as the author knows, many companies plan to resume work
on February 17.
The first quarter is the traditional peak season of the aluminum market, although the current downstream start is not good due to the epidemic, but over time, the epidemic will eventually be controlled, more and more companies will resume work, and trading will eventually pick up, which will be positive for aluminum prices
.

Although the epidemic has had a certain impact on the real economy, the state has introduced a number of support measures to mitigate the impact
of the epidemic on the real economy.
According to the official WeChat message of the Ministry of Communications, with the consent of the State Council, from 0:00 on February 17 until the end of the epidemic prevention work, toll roads nationwide will be exempted from vehicle tolls
.
Henan, Sichuan, Jinan, Ningxia and other places have introduced support policies to mitigate the impact
of the epidemic on enterprises.

Judging by market sentiment, financial markets have improved
.
The stock market can be used to judge the quality of financial market sentiment
.
On February 3, the Shanghai Composite Index opened sharply and low, opening at 2716.
7 points, and then the broader market continued to recover, and as of February 14, the Shanghai Composite Index closed at 2917.
01 points, and most of the gaps in the index gap were responded
.
It can be seen that the market sentiment is not pessimistic
.

To sum up, as the epidemic is gradually brought under control, the late start season will eventually return
.
The continued recovery of the stock market shows that the market sentiment is not pessimistic, and the government has introduced a variety of support policies, which will be positive for aluminum prices
.
In the short term, it is expected that the Shanghai aluminum index will oscillate to the bottom, with an operating range of 14,000-14,500 yuan / ton
.
Pay attention to the progress of anti-epidemic and the resumption of work of
downstream enterprises.