The upward trend of the center of gravity of aluminum prices in the peak season has not changed for the time being

In the spot market, the transaction this week is general, the downstream processing plant still has no willingness to actively prepare inventory, and the willingness of middlemen to trade has also weakened
.
The spot spread slowly narrows
as the delivery date approaches.
The spot transaction price range is in the range of 14500-14650 yuan / ton, and the fluctuation range is very limited
.
The change in the futures spot spread is also small, and the basis at the beginning of the week gradually rises from -50 last week to around -30, and the highest rises to flat water
.

Inventory changes, this week's London Stock Exchange aluminum stocks continued to decline, down 46,400 tons a week, and the total inventory fell to 1.
264 million tons
.
This week's warehouse receipts also fell by more than 40,000 tons, accounting for 32%.

After the decline in contact in the previous two weeks, the inventory of aluminum ingots in the previous period of this week rose again, and the weekly inventory increased by 58000 tons, and the total inventory rose to 992,000 tons
.
In terms of distribution, the inventory in Shandong and Jiangsu increased by 2800 tons and 2700 tons respectively, the inventory in Shanghai increased by 1000 tons, the inventory in Guangdong increased by nearly 600 tons, and the inventory in Zhejiang, Henan and Chongqing decreased
.
Warehouse receipts rose 2,518 tonnes to 864,000 tonnes
this week.
The domestic peak season is not as good as the market expectation, although downstream enterprises maintain a high operating rate, but the willingness to actively prepare stocks is weak, so even if the contribution of new investment capacity to production improvement is still limited, the decline in domestic aluminum ingot social inventory is slow
.
Total stocks fell below 2.
2 million tonnes this week, less than a million tonnes in a
week.

Market outlook, domestic new production capacity continues to advance, still dominated by Inner Mongolia and Guangxi, but the recovery of output growth is still limited
.
SMM data shows that the national primary aluminum output in April was 2.
951 million tons, down 3.
1% year-on-year, and the cumulative output in the first four months was 11.
715 million tons, down 2.
6%
year-on-year.
Affected by Xinjiang's capacity suppression policy, Shenhuo Group and its sub-groups have successively transferred production capacity to Yunnan, which will delay the operation of this part of the production capacity, but the new production capacity in Inner Mongolia and Guangxi will be gradually released as planned, but the short-term domestic production growth rate is still limited
.
Downstream starts remained high during the domestic peak season, while exports also maintained a strong momentum, as the continued weakening of internal and external price differentials was conducive to exports
.

The performance of peak season inventory dematerialization was less than expected, mainly due to the low willingness of downstream processing companies to actively prepare inventory, but the overall inventory still showed a downward trend, and the total inventory fell below
2.
2 million tons this week.
Recently, domestic alumina prices have been relatively stable, although overseas alumina prices have fallen after the Rusal incident, but they are still at a high level, because Hydro's alumina plant in Brazil has not resumed production, resulting in alumina exports still profitable
.
Domestic electrolytic aluminum costs remained stable
.

On the whole, peak season consumption remains at a relatively high level, although the inventory dematerialization is less than expected, but the trend of phased improvement of supply and demand fundamentals remains unchanged, which determines that the upward trend of the center of gravity of aluminum prices in the peak season has not changed
for the time being.
In addition, the growth rate of exports is expected to rise significantly in May, as the internal and external prices reached a new low in April, which also played a role
in the improvement of domestic fundamentals.
In the medium term, as new production capacity continues to be put into operation, consumption weakens after the peak season, fundamentals weaken, and prices are under pressure
.
In addition, the interference of the domestic political and economic situation on the market cannot be ignored
.
In the short term, futures aluminum prices still have some room to rise, and it is recommended to pull back to buy
.