The aluminum market lacks sustained upward momentum and will still maintain a volatile trend

After the Dragon Boat Festival, the aluminum price above Wanjiu opened high and low, and the price fluctuated down to the 18500 line after the news of the national reserve on the 16th, and the subsequent aluminum market rose under obvious pressure, closing at 18380 yuan / ton on the 18th, down 4.
25%
last week.

On the supply side, production in June is expected to fall by about 110,000 tons from May to 3.
205 million
.
In June, supply-side disturbances increased, and the impact of limited operating capacity in most regions continued to decline, and electrolytic aluminum production in June is expected to be about 3.
2 million tons, down 10-150,000 tons
from May.
The power curtailment in Yunnan affected 865,000 tons of annual production capacity, and the two new investment projects in Guangxi Bai Mine were suspended and restored
.
The relatively smooth new production is Hengkang, Shaanxi County, which is expected to reach production
in early July.
In terms of imports, the current import side is facing continuous Shanghai ratio retracement pressure, import profits are below the profit and loss line, and the pressure on the import side will continue
.

In terms of demand, last week's spot quotation premium turned to discount again, downstream processing fees were relatively stable, the overall fluctuation range was not obvious, the downstream resumed work slowly after the Dragon Boat Festival, the market started slowly, and the overall liquidity level was not high
.
With the rumor of the State Reserve Bank throwing aluminum, the spot market benefited from the decline in prices, and trading gradually improved
.

Last week, rumors of the State Reserve Bank throwing aluminum were confirmed, and the market consensus on the incident was that the scale of aluminum available for storage would be less than 1 million tons, and the dumping method would be sold to downstream companies in the form of public bidding at the end of each month and continue until the end of
December.
The final dumping scale is expected to be on the water level of 200,000-600,000 tons, and the fluctuation range of monthly dumping reserves is expected to be between
3-100,000 tons.
The supply-side disturbances in June included power cuts in Inner Mongolia, Yunnan, Guangdong and Guizhou, and production in June fell to 3.
205 million tons compared with May.

The current electrolytic aluminum social inventory continues the rhythm of destocking, this week's inventory decreased by 29,000 tons to 890,000 tons, the speed of destocking further slowed down, while the downstream resumption of work after the Dragon Boat Festival is slow, the market starts slowly, and the overall circulation level is not high
.
With the rumor of the State Reserve Bank throwing aluminum, the spot market benefited from the decline in prices, and trading gradually improved
.
The market is at the end of the consumption season, and the fundamentals will lack the momentum to promote the continuous upward trend of aluminum prices after the marginal decline in consumption, and it is expected that aluminum prices will remain volatile for a period of time in the future
.