LME aluminium saw upward movement during Thursday night trading; SHFE remains strong on suspended capacity

Strong retail sales and labour data bolstered the US dollar on Thursday. LME aluminium traded flat and SHFE aluminium inched up close to 0.1%.

Despite the rebound in the greenback, three-month LME aluminium rallied from earlier lows to close 0.84% higher at US$1,868 per tonne on Thursday night, recovering from much of the losses in the previous day. The cash contract also closed the trading day almost flat and gained slightly overnight. Weak fundamentals will likely keep gains in LME aluminium in check. It is expected to trade within a tight range in the short term.

As on April 18, LME aluminium cash (bid) price stood at US$ 1838.50 per tonne, LME official settlement price stands at US$ 1839 per tonne; 3-months bid price stands at US$ 1854 per tonne, 3-months offer price is US$ 1854.50 per tonne; Dec 20 bid price stands at US$ 1983 per tonne, and Dec 20 offer price stands at US$ 1988 per tonne.

The LME aluminium opening stock dropped to 1053925 tonnes. Live Warrants totalled at 664950 tonnes, and Cancelled Warrants were 388975 tonnes.

LME aluminium 3-months Asian Reference Price is hovering at US$ 1845 per tonne.

SME and SHFE Aluminium Price Trend

The benchmark aluminium price on Shanghai Metal Exchange increased to US$ 2100 per tonne today from US$ 2096 per tonne on April 18.

Lower inventories of primary aluminium and aluminium billet across social warehouses bolstered the most-active SHFE June contract. Longs pulled the contract to a high of RMB 14,110 per tonne in the afternoon, before it closed at RMB 14,055 per tonne. Potential resumption of suspended capacity is expected to limit the upward room in the contract in the near term. The June contract then traded in a narrow range to end marginally higher at RMB14,060 per tonne overnight. News of capacity shutdown prompted longs in Shanghai to aggressively load up positions for three consecutive days. SHFE aluminium is expected to trade between RMB 14,000-14,100 per tonne today with spot discounts of up to RMB 40 per tonne.

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