Macro: Domestically, the State Council Financial Committee held a special meeting, which stressed the need to actively introduce policies that are beneficial to the market and cautiously introduce contractionary policies. Overseas, Kremlin spokesman Peskov said that reports of significant progress in Ukraine negotiations were “wrong” and oil prices were back above $100.
Supply and cost: supply side, the domestic electrolytic aluminum enterprises to start production capacity continues to rise, the epidemic has not caused the domestic electrolytic aluminum plant to reduce production, but the upstream and downstream transportation is affected to some extent. On the cost side, the domestic electrolytic aluminum raw material alumina, prebaked anode and other auxiliary materials market temporarily stable operation, some areas of the cost of self-provided power plants have declined.
Demand: aluminum ingots, aluminum rods out of storage accelerated, and higher than the same period in previous years. Even if affected by the epidemic, aluminum ingots, aluminum bars still maintain to depot, aluminum ingots weekly depot range even expanded compared with last week.
Inventory: As of March 17, SMM statistics of domestic electrolytic aluminum social inventory of 1.089 million tons, compared with last week four weeks to 53,000 tons. As of March 18, the bonded area aluminum ingot inventory of 75,000 tons, 0.4 million tons less than last week; LME inventory of 715,200 tons, 40,700 tons less than last week.
Import profit: the current Shanghai aluminum spot instant import loss of 2344 yuan / ton, Shanghai aluminum 3-month futures import loss of 2223 yuan / ton.
Viewpoint: Russia and Ukraine situation repeatedly, overlapping with domestic demand is good, aluminum prices last week low rebound. First, the Russian side denied that the negotiations made significant progress, crude oil prices soared again, the market for the war caused by supply worries again. Over the weekend, Australia announced a ban on bauxite, alumina exports, according to the United Nations Commodity Trade Statistics Database, Russia 20 years did not import bauxite to Australia, imports of alumina of about 1.41 million tons. According to the Russian aluminum 20 years of electrolytic aluminum production projections, the sanctions may cause a shortage of raw materials end of Russian aluminum. On the domestic side, the spot market peak season opening signal may have appeared, and policy trends to improve demand expectations. According to Shanghai non-ferrous data, last week, aluminum ingot, aluminum bar out of the accelerated, and higher than the same period in previous years. Even if affected by the epidemic, but in the low aluminum price stimulation, aluminum ingot, aluminum bar still maintain to warehouse, and aluminum ingot weekly to warehouse increased significantly. However, the impact of the epidemic on the transport side still need to continue to pay attention to. In addition, the State Council Finance Committee meeting content to stabilize the market sentiment, solid annual loose monetary and fiscal policy tone, and the Ministry of Finance said this year does not have the conditions to expand the real estate tax reform pilot cities also enhanced the market for real estate soft landing confidence. The “policy bottom” has appeared, is expected to construction real estate plate with aluminum demand and will not collapse, and in infrastructure, new energy vehicles and other plate pull, electrolytic aluminum demand can still be optimistic. Comprehensive view, based on the national annual 5.5% economic growth target, we believe that long-term aluminum prices still have room to rise, but short-term by the repeated situation in Russia and Ukraine and the domestic epidemic, or a wide range of oscillation.
Post time: Mar-21-2022