Newsletter summary
Shanghai aluminum price fluctuates, aluminum ingot inventory drops by 1.Baccaratcounting.30,000 tons, the export volume increased by 12.6% compared with the same period last year, aluminum prices are expected to be adjusted by limited shocks, and the operation is recommended to sell short every high. Shanghai zinc prices rebounded, April output fell 3.99% month-on-month, production is expected to increase 26800 tons month-on-month in May, zinc prices high adjustment, the operation recommended to sell short every high.
Text of news flash
[trends of Shanghai Aluminum and Shanghai Zinc Market] on Thursday, Shanghai aluminum market experiencedBaccaratcountingFluctuations, the spot SMM average price reached 20520 yuan / ton, up 190 yuan / ton over the previous trading day. At the same time, the average spot price of Southern Reserve also rose by 170 yuan / ton to 20500 yuan / ton.
Stocks of aluminum ingots were 778000 tons on May 9, down 13000 tons from last Thursday, according to SMM. Stocks of aluminum bars stood at 211100 tons, down 6700 tons from last Thursday. In addition, according to industry sources, the country's exports of unwrought aluminum and aluminum products reached 520000 tons in April 2024, an increase of 12.6 percent over the same period last year, while cumulative exports climbed to 1.998 million tons from January to April, an increase of 8.8 percent over the same period last year.
Although Shanghai Aluminum is expected to increase supply in the short term and the premium repair after the macro shift is flat may have an impact on aluminum prices, the destocking of social inventory of aluminum ingots and the robust performance of aluminum export data show the resilience of aluminum consumption. In view of the current market conditions, market analysts predict that aluminum prices may show a volatile adjustment trend with limited space. In response to this situation, the operational advice of investors is to short every high.
In terms of the Shanghai zinc market, the contract price of 2406 of the main zinc in Shanghai showed a volatile trend on Thursday, and the center of gravity of the market moved up at night. Spot market data show that the mainstream transaction price of zinc in Shanghai is concentrated at 23080,23210 yuan / ton, with a discount of 70-80 yuan / ton to 2406 contracts. Under the support of traders' tickets, the spot discount has narrowed, while downstream purchases are mainly focused on bargain-seeking opportunities, and transactions have decreased when zinc prices rebounded.
As of Thursday, social inventories stood at 212900 tons, down 3400 tons from Monday, according to SMM. In addition, refined zinc production in April was 504600 tonnes, down 20900 tonnes, or 3.99 per cent, from a month earlier, and 6.56 per cent lower than a year earlier. The cumulative output from January to April was 2.1 million tons, down 0.47% from the same period last year, which is basically in line with market expectations. In May, refineries reduced and resumed production side by side, and production is expected to increase by 26800 tons to 531400 tons from the previous month. LME stocks decreased by 625t to 252125 tonnes.
According to the comprehensive analysis, although the favorable interest rate cut of the US unemployment data exerts pressure on the US dollar and thus has a bullish effect on zinc prices, the market still faces the challenge of refinery raw material inventory falling to the low level in recent years and profit loss, resulting in a lack of willingness to increase production. Taking into account the post-holiday downstream rigid demand replenishment brought about by a small reduction in social inventory, as well as the gradual fading of macro optimism, the trend of zinc prices is expected to return to fundamentals. At present, the improvement of downstream demand is still relatively limited, zinc prices are likely to maintain a high adjustment. For investors, the operational advice is to sell short at every high.
