Aluminum stocks remain high, aluminum prices remain weak

Aluminum stocks at home and abroad are all maintained at high levels, and the spot price of aluminum prices is to maintain the weakness of the year.

As of last weekend (December 21), the London Metal Exchange (LME) increased its aluminum inventories by 5.3% to 5.32 million tons this year, setting a record for the LME.

With high inventory levels and sluggish demand, Barclays even advised investors to sell aluminum contracts, while Morgan Stanley researched that aluminum is the most bleak prospect among all commodities. Aluminum ranks at the bottom of the 21 commodities it tracks.

In addition, according to Barclays, aluminum inventory will continue to increase in the next four quarters at least, and will reach a record 8.67 million tons by the end of 2013. Particularly, China, and other large aluminum supply countries will expand aluminum production and will promote excess. The supply has reached the highest level since 2009.

The oversupply of the global aluminum market will inevitably put pressure on aluminum prices. Compared with the overall price in January of this year, LME aluminum prices have experienced significant declines. Although they have rebounded in the middle of the year, they still do not change the situation of the year.

Judging from the domestic situation, the Shanghai Stock Exchange (hereinafter referred to as the “Schedule”) currently maintains a high aluminum inventories of 440,000 tons, an increase of over 100% compared with the inventory level at the beginning of the year, and in mid-November, the previous period Aluminium stocks hit a record high of 460,000 tons in the past two years. In terms of prices, since the beginning of the year, the Shanghai aluminum futures price has continued to fluctuate, and the price of main contract contracts has fallen by nearly 10%, and prices have remained weak for the whole year.

In terms of social stocks, domestic aluminum stocks currently remain at a high level of over 1 million tons. The person in charge of the China Non-Ferrous Metals Industry Association had expected that China had an estimated 1.2-1.5 million tons of aluminum stock.

Worrying is that the domestic aluminum supply surplus is not only difficult to ease, but also in the process of substantial increase in production, the National Bureau of Statistics data show that China's primary aluminum production in November was 1.664 million tons, an increase of 20.8%; from January to November The output of primary aluminum was 17.96 million tons, a year-on-year increase of 12.1%.

A nonferrous metal analyst told the reporter of the “First Financial Daily” that the global aluminum market is currently in a state of severe excess supply, while China is still in the stage of increasing production capacity, and there has been no sign of any decline in output. Both domestic and foreign markets, weak market demand will continue to drag down and lower aluminum prices.

In China, capacity expansion is mainly concentrated in the western region. In the western region, electricity prices are low. The abundant coal resources have led to significant expansion of primary aluminum production capacity in the region. At the same time as the expansion of the western electrolytic aluminum project, the eastern electrolytic aluminum production capacity has not decreased, resulting in overall overcapacity. More serious. According to statistics, China's electrolytic aluminum production capacity will reach 28 million tons in 2012 and it is expected to exceed 30 million tons in 2013.

Under the background of weak downstream demand and rising aluminum inventories, the increase in aluminum production has undoubtedly increased the supply and demand imbalance in the domestic aluminum market. This has led to a sluggish aluminum prices in the spot market and the aluminum market in the spot market. Since the second half of 2011, domestic aluminum prices have been all the way. As a result, the downstream domestic electrolytic aluminum companies suffered serious losses, and most of the companies were unable to achieve profitability.

To this end, the State Reserve Bureau had previously started aluminum storage and storage. The delivery time for storage and storage continued from November 29 to December 29, totaling 160,000 tons. The delivery locations involved Henan, Guizhou, Heilongjiang, Qinghai, and Hubei. Eight provinces and autonomous regions of Guangxi, Guangxi, Sichuan, and Jiangxi range from 10,000 to 23,000 tons in each region. However, compared with stocks of up to one million tons, the collection and storage of 160,000 tons seems to be far from changing. Awkward situation.

Most institutional research reports believe that under the impact of low energy costs in the central and western regions, China's primary aluminum market will face greater pressure of oversupply next year, and aluminum companies in the central and southwest regions will once again face a severe test. In the medium term, the domestic Aluminum prices will continue to remain weak.