Aluminum alloy inventories in China have fallen three weeks straight . Supply's tightening. Last Thursday, domestic social inventory of secondary aluminum alloy ingots dropped by 5,600 metric tons week-on-week,hitting 53,100 metric tons.
June 18, Shanghai Futures Exchange (SHFE) noted a drop in registered warrants for secondary cast aluminum alloy — down 2,170 metric tons to 33,785 metric tons. Shanghai’s registered warrants totaled 2,956 metric tons,down 389. Guangdong saw a decrease of 483 metric tons to 5,622 metric tons. Jiangsu's numbers held steady at 7,775 metric tons,but Zhejiang and Chongqing had declines of 817 and 481 metric tons,respectively.
Aluminum scrap prices also hit. June 18, price difference between A00 aluminum and mixed aluminum extrusion scrap free of paint in Foshan was 2,347 yuan per metric ton. Shredded aluminum tense scrap saw a difference of 1,696 yuan. Rising enterprise tax costs, up over 2% year-on-year, squeezed the gap . Scrap prices holding firm.
Demand for secondary cast aluminum alloy still weak. Downstream orders sluggish. Purchasing support for wrought aluminum alloy fading. Suggests end-use consumption won't improve much near term.
Market expects aluminum scrap supply to keep tightening due to production cuts,shutdowns. Prices should find floor,but overall supply-demand imbalance in scrap market unlikely to reverse soon.
Silicon metal prices stable before holiday. SMM assessed oxygen-blown #553 silicon in East China at 9,100-9,200 yuan per metric ton,while #441 silicon priced at 9,300-9,400 yuan. Most-traded futures contract around 8,550 yuan per metric ton . Weaker trend than before. Quotes from silicon producers mostly unchanged,keeping market sentiment rational.
Internationally,import offers for ADC12 retreated slightly to $3,300-$3,380 per metric ton. Immediate import losses narrowed to about 2,600 yuan per ton,easing price inversion,but theoretical import window still shut.
Last Friday,ADC12 market held steady at 24,100 yuan per metric ton. Short term,prices expected to stay elevated,tight scrap and high costs supporting them. But weak end-use demand caps potential for upward movement.
Looking ahead,two critical factors loom: possibility of end-use demand recovery in peak season second half,and ongoing supply constraints from invoice oversight. If demand rises while supply stays tight,market could tighten,prices rise. But if demand disappoints,prices may just stabilize in narrow range…
