The current inventory is at a high level, and the upside of aluminum prices is limited

During the Spring Festival holiday, the US Department of Commerce released the previous "232 investigation" report, believing that the import of aluminum products harmed national security, recommended that President Trump take tariff and quota measures to restrict imports, and put forward three trade protection proposals: impose tariffs of at least 7.
7% on aluminum imports from all economies; or impose a 23.
6 percent tariff on imports from Chinese mainland, Hong Kong, Russia, Venezuela and Vietnam, and set import quotas on the remaining economies equivalent to their 2017 exports to the United States; Or set import quotas
for all economies equivalent to 86.
7% of their 2017 exports to the United States.

According to the legal process, Trump will decide by April 19 this year whether or what trade protection measures
to take against imported steel and aluminum products based on the recommendations of the Commerce Department.
Affected by this, the prices of Lun Aluminum and Alcoa related stocks rose
.
In 2017, China's aluminum exports to the United States and Vietnam accounted for 17% and 3%
respectively.
Until the United States decides whether to adopt trade protection measures, the aluminum to Shanghai ratio may continue to be suppressed
.

LME aluminum stock game continues
.
Long before the survey was announced, LME aluminum stocks rose by 150,000 tons
in a single day on February 13.
After the release of the survey, the LME aluminum spot price showed a sharp increase and delivered profit
.
This inventory change is concentrated in Malaysia and Singapore, where only a small portion of inventory is picked up for local downstream processing, mainly destined for the United States
.
LME aluminium stocks still reach 1.
3 million tonnes, which does not support a significant premium to the LME structure, and LME spot premiums will gradually decline
as the delivery ends.

Back to China, the domestic social inventory before the holiday has reached 1.
8 million tons, according to seasonal factors post-holiday social inventory will continue to increase, the market expected the post-holiday inventory high or to 2.
2 million tons, higher inventory pressure or Shanghai aluminum prices continue to be suppressed
。 There are still several variables worth paying attention to in the judgment of aluminum prices after the holiday, one is the end of the disturbance of supply and demand in the heating season, domestic downstream consumption recovers before the supply side production restrictions, and the inventory increase is less than expected; Second, the disguised export increased under the ratio of domestic and foreign bottoms, and aluminum exports continued to contribute growth in February and March; Third, after the end of the heating season, it is difficult for Henan to resume production at the current price; Fourth, the supply-side reform is still underway in 2018, and the probability of the whole industry re-entering the loss is small
.
Shanghai aluminum still has a margin of safety at current prices
.

With the recovery of consumption and the stabilization of inventory, the price of Shanghai aluminum is expected to show an upward repair, and it is expected that the main operating area of Shanghai aluminum is 13800-15000 yuan / ton
.
The price of London aluminum is expected to remain mainly volatile, with a core operating range of 2100-2250 US dollars / ton
.