LME aluminium closed lower at US$ 2278.5 per tonne yesterday; SHFE to stay rangebound over the day

Base metals saw mixed trading on higher US dollar price, but LME aluminium went up slightly last week on the new of easing of sanction on Rusal. LME aluminium stood rangebound and closed lower at US$ 2278.5 per tonne on May 21 Monday from US$ 2297 per tonne on previous closing. According to Shanghai Metals Market, LME aluminium traded with momentum overnight and tested pressure at US$2,300 per tonne, as oil prices strengthened. The contract is likely to trade at US$2,360-2,300 per tonne today.

As on May 21, LME aluminium cash (bid) price stands at US$ 2278 per tonne, LME official settlement price stands at US$ 2278.50 per tonne; 3-months bid price stands at US$ 2279.50 per tonne, 3-months offer price is US$ 2280 per tonne; Dec 19 bid price stands at US$ 2253 per tonne, and Dec 19 offer price stands at US$ 2258 per tonne.

After hitting a seven-year high of US$ 2,718 per tonne on April 19 the London Metal Exchange aluminium price has retreated to a current level of US$ 2,268. 3 months LME aluminium stands a little higher than LME cash after almost a month. 

The LME aluminium opening stock slightly dropped to 1234575 tonnes. Live Warrants totalled at 966375 tonnes, and Cancelled Warrants were 268200 tonne.

LME aluminium 3-months ABR price is hovering low at US$ 2265.44tonne.

SME and SHFE Aluminium Price Trend

The benchmark aluminium price on Shanghai Metal Exchange dropped slightly from US$ 2296 per tonne on May 21 to US$ 2293 per tonne on May 22.

The SHFE 1807 contract rose to a high of RMB 14,860 per tonne yesterday as domestic inventory dip steadily. Both long and short positions were reduced and the SHFE 1807 contract mostly hovered around the daily moving average last night. Investors will monitor any impact on prices from the domestic declining aluminium inventory. The contract is expected to trade at RMB 14,690-14,850 per tonne today with spot discounts at RMB 100-60 per tonne. 

As US-Sino trade concerns eased, the US dollar surged to a high of 93.97 overnight closing at 93.55. The US dollar is likely to test 94 above, while base metals are expected to trade rangebound with upward momentum as China and US avoided a trade war.

US Commerce Secretary Wilbur Ross will travel to China next week to discuss a trade agreement after the two countries reached an initial framework last week, Mnuchin said on Monday.  These developments are expected to ease down the current volatility in the market.

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