According to foreign news on October 30, domestic and foreign aluminum inventories have continued to fall in the near future, while the consumer real estate and auto industry's performance this year is less than expected, and the global economy is not very optimistic in the future, aluminum prices will be supported.
** Ebola outbreak affects bauxite exports in Africa** According to the World Health Organization, as of October 19, there were 9,936 cases of suspected and potentially infected Ebola cases, and 4,877 people had died. The Ebola virus has not been effectively controlled. In Africa, where the epidemic is most severe, there is a country with a very rich bauxite mine, Guinea. From January to July, Guinea’s share of global bauxite exports accounted for 29%. After the Ebola outbreak, Guinea's bauxite production fell 3.5% in the first quarter. Bauxite exports have fallen sharply and market supply has tightened. In the context of the Indonesian mine ban, the global supply of bauxite has been reduced, and the epidemic in countries such as Guinea and West Africa has made this situation worse. In order to stop the spread of the epidemic, most countries have suspended the import of bauxite from West African countries. This has led to many aluminum smelting projects having to stagnate in the short term.
According to China's import data, China imported 2,855,700 tons of bauxite in September, a year-on-year decrease of 62.38%. In the first nine months, the total amount of bauxite imported from China was 27.94 million tons, a decrease of 47.77% year-on-year. China's bauxite imports fell sharply in September, mainly due to Indonesia's export restrictions on bauxite and the erosion of the Ebola epidemic. As far as the current situation is concerned, the import situation will not change much in the short term, and the import of bauxite in China may be temporarily trapped.
Entering the bottleneck, future imports will remain near 2.7 million tons per month.
In October, LME aluminum inventories continued to decline rapidly. As of the close on the 28th, the total inventory had dropped to 44,364,050 tons, down 18.87% from the highest inventory of 5,468,900 tons at the beginning of the year. However, with the recent decline in aluminum prices, market expectations have begun to gradually return to rationality. It is expected that the smelting enterprises that planned to resume production will also slow down, and it is difficult for the overall supply in the market to increase significantly. This will make aluminum prices stable at the current price. In the last October, the aluminum stocks continued to fall. As of the 24th, the total inventory has dropped to 238,448 tons, down 7.75% from the 258,500 tons at the end of September. As can be seen from the data, the aluminum inventory in the previous period in October still maintained a downward trend, but the inventory has not yet returned to the low level at the beginning of the year. With the arrival of the stock market at the end of the year, the inventory may be further reduced. This has a supporting role for domestic aluminum prices. Aluminum prices will oscillate upward Looking ahead, China's economy will continue to be weak, and it is difficult to introduce strong stimulus policies. The US economy has recovered steadily, the US dollar index has hit record highs, and monetary tightening is expected to put pressure on economic growth in other countries around the world.
From the supply side, there are some problems in the upstream of electrolytic aluminum. It is expected that the output of electrolytic aluminum will not increase rapidly in the future. The spot market is relatively stable. The domestic price is basically maintained at around 14,000 yuan/ton, and domestic and foreign stocks are still in existence. Continued to fall, the support of the above factors for futures prices still exists. From the perspective of consumption, the performance of the real estate and automobile industries was not as good as expected this year. The order volume of aluminum processing enterprises increased finitely, and the overall operating rate remained at around 80%.
In summary, the current aluminum price is still in the finishing stage after a sharp correction. In the case of bottlenecks on the supply side, the trend is strong.