LME plunged further yesterday on stronger greenback; SHFE dropped to the lowest in about six weeks

The US dollar rose to a two-week high of 99.06 against a basket of currencies on Wednesday after the launch of a formal impeachment inquiry against President Donald Trump, while the political uncertainty added to worries about economies strained by the Sino-US trade row. LME aluminium dropped and SHFE aluminium fell 0.2%.

The load-up of short positions knocked three-month LME aluminium below moving averages to a three-week low of US$1,750 per tonne on Wednesday night, before the contract closed 0.57% lower at US$1,752.5 per tonne. Poor demand overseas and a stronger US dollar will keep LME aluminium weak in the short run. The contract is expected to hover between US$1,750-1,800 per tonne today.

As on September 25, Wednesday, LME aluminium cash (bid) price stood at US$ 1735 per tonne, LME official settlement price stands at US$ 1736 per tonne; 3-months bid price stands at US$ 1758 per tonne, 3-months offer price is US$ 1758.50 per tonne; Dec 20 bid price stands at US$ 1840 per tonne, and Dec 20 offer price stands at US$ 1845 per tonne.

The LME aluminium opening stock increased to 907400 tonnes. Live Warrants totalled at 719350 tonnes, and Cancelled Warrants were 188050 tonnes.

LME aluminium 3-months Asian Reference Price is hovering at US$ 1757 per tonne.

Benchmark aluminium price for SHFE (Shanghai Future Exchange) stands at USD 2035 per tonne today, 26 September 2019.

As longs took profits from previous gains, the most-liquid SHFE November contract slipped and ended the trading day at a low of RMB 14,110 per tonne yesterday, down 0.7%. The SHFE 1911 contract then slipped to a low of RMB 14,080 per tonne, the lowest in about six weeks, overnight before it ended 0.21% lower at RMB 14,115 per tonne. Despite a continued high consumption season, expectations for greater supply at the end of the year and weaker demand after the week-long break sent SHFE aluminium to the 60-day moving average. The SHFE 1911 contract is expected to hover between RMB 14,050-14,200 per tonne today, with spot premiums of RMB 20-40 per tonne over the 1910 contract. 

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