IGI Logo

Aluminium

Aluminium future in Shanghai slipped to more than 6-month low

Base metal complex were largely under pressure last week as global recessional fears left investors in the lurch and this market sentiments hit Aluminium prices as well. Slowing manufacturing activities in major economies along with aggressive scaling back of liquidity measures from major central banks across globe spooked worries that it could damage economic growth. Whereas demand in China still struggling to pick up as lockdowns aren't really ending as quickly as hoped, as the country continued to impose tough restrictions to completely eliminate Covid-19 infections.

Prices of aluminium on Shanghai futures platform slipped to lowest level since late December 2021 and finally settled at 19600 CNY/MT in previous week. MCX aluminium prices hit the lowest level in 2022. Benchmark aluminium prices in London Metal Exchange slipped last week too by shedding around 7.00 percent.

In the meantime, a stronger US Dollar continued to side line investors as the metal become more expensive. On the other hand, Europe’s primary aluminium smelters are continuing to cutdown production on soaring energy prices as smelting activity is an energy intensive business . Western European output of primary aluminum totalled 244,000 tonnes in April, that was down by 13.2 percent on April last year, according to the latest assessment by the International Aluminium Institute (IAI).

China’s Aluminium imports

Slipped in May According to Chinese government data, imports of aluminium fell 16.4% in May from the same month a year earlier, on amid higher overseas prices and weak domestic demand. While the import data by General Administration of customs showed that country brought 188,469 tonnes of unwrought aluminium and products, which includes primary metal and unwrought, alloyed aluminium in May. However the last month imports were slightly up from 175,289 tonnes in April. Meanwhile China’s exports of unwrought aluminium and aluminium products increased 54% from a year earlier to 676,605 tonnes in May, which marked the highest level in at least nine years.

Warehouse stock level

The aluminium inventory levels in LME registered warehouses decreased last week by 16100 MT and totalled 407875 MT. The inventory level in SHFE registered warehouses depleted as well last week by 2246 MT and totalled at 267337 MT.

Outlook

LME: Worries over global growth prospects and a firm US dollar continue to hit the demand for base metals.

MCX Jun: Corrective selling pressure may continue while prices stay below Rs 248. Anyhow, major liquidation expected only consistent trades below the stiffs support of Rs 206.

To Read Complete Report & Disclaimer Click Here

For More Geojit Financial Services Ltd Disclaimer https://www.geojit.com/disclaimer 

SEBI Registration Number: INH200000345

Views express by all participants are for information & academic purpose only. Kindly read disclaimer before referring below views. Click Here For Disclaimer