Aluminum ingot prices stop falling and rise, with little downward space

1. Trade name: standard aluminum ingot (99.70)

2. Latest price (October 16, 2019): 13896.67 yuan / ton

3. Analysis points:

Since the middle of September, aluminum prices have been falling continuously. On the one hand, the production capacity that was shut down for some reasons in the early stage has gradually recovered, and the domestic supply side pressure has been reflected in the market in advance.

It is reported that in the near future, about 50000 tons of hydropower capacity in the western part of Qinghai has been resumed; 500000 tons of affected capacity in the early stage of Xinjiang Xinfa has been resumed one after another; 450000 tons of capacity has been resumed in Weiqiao, Shandong, and the remaining capacity is still in the process of recovery; 250000 tons of capacity in the second phase of new Hengfeng, Baotou City, is expected to start power on and put into operation on October 15. After October, 200000 tons of creative metals, 100000 tons of Yunnan Shenhuo phase I, 150000 tons of Yunnan Qiya, 150000 tons of 100 mines and 250000 tons of Guangyuan Linfeng are planned to be put into production again, totaling about 850000 tons.

On the other hand, the main reason is that the early news of Indonesia’s ban on bauxite led to a sharp rise in aluminum prices. Based on the release of news that Indonesia’s bauxite accounts for 1-20% of the total import of domestic bauxite, the market estimates whether Indonesia’s ban on bauxite or not has limited impact on aluminum prices, and the expectation of long aluminum prices is broken. The price of aluminum ingot gradually returns to the actual supply and demand.

4. Future forecast: in the near future, the alumina price is relatively strong, the aluminum ingot cost support is strong, the superimposed social inventory is significantly lower than that in the early stage, and the overall fundamentals are good. In addition, at present, the aluminum ingot price basically returns the increase in the early stage, and the downward space is expected to be limited. In the later stage, attention is paid to the actual market situation.