Aluminium: Seeking support in the downturn oscillation trading in the second quarter of 2004 was a quarter in which the price of aluminum oscillated lower. LME aluminum prices began a sharp decline in trading prices after hitting a record high of 1,845.5 US dollars in the past 9 months in mid-April. The price fell by 16% in a short period of one month and the lower price reached $1554.5/ton. In addition, the price once rebounded in mid-May, and it has recently resumed its downward trend in the absence of strong buying power. The entire price drop is closely linked with China’s macroeconomic regulation and the US interest rate hike forecast. Short-term prices are still under pressure from the United States to raise interest rates further and pressure to sideways trade transactions. The aluminum market in Shanghai and Lon Aluminum are basically similar in price, but the magnitude of their decline is much larger than that of Lon Aluminum. The rate of decline has reached 21.8%. From the higher 19,430 yuan/ton to the lower 14,900 yuan/ton. In addition, after the rebound of aluminum prices in May, Shanghai Aluminum's rebound price was relatively limited, and it has been trading at a domestic average cost of production of 16,500 yuan per ton. Even if Chinalco cuts its alumina prices, it will be lower than the cost price. The following runs. Lead to a larger part of the aluminum plant began to reduce the plan. However, as Chinalco cut its alumina price to RMB 3,750/t, it seems to give the market a feeling of exhaustion and prices have started to recover from the lows. I. Cost Analysis After the aluminum price fell below the production cost of most production companies, it again became the focus of the current market. The price of electricity is basically within the scope of the country's macro control. Therefore, the management costs and depreciation for the removal of alumina production costs are relatively fixed. The focus of the market can also be completely transferred to the alumina price trend. The price of electricity is opposite to the price of alumina. After the high-speed development of high-energy-consuming industries, the shortage of energy, especially the shortage of electricity, has become more prominent. As a result, the price of coal has begun to soar, and the price of electricity within the scope of national regulation has also had to be raised. The recent two consecutive price increases are a reflection of the sharp increase in coal prices, and the average price has risen by 3 points/degree. The overall electricity cost will increase further. From the point of view of electricity alone, the cost is increased. With an increase of 3 points/degree, the cost is increased by RMB 450/ton. The higher cost of electricity will also continue. After all, the price of coal is still rising, putting pressure on the national electricity price regulation. The drop in alumina prices is far greater than the increase in electricity prices. The overall electrolytic aluminum production cost will further follow the fall in alumina prices and the center will continue to move downwards, which is unfavorable to the trend of aluminum prices in the second half of the year. The overall global supply and demand situation of supply and demand will still support prices in the third quarter. However, the exaggeration of short-term Chinese factors and the continuous increase of Chinese stocks have all indicated that the oversupply will continue. The short-term export has certain support for Shanghai Aluminum but it is a pressure on Aluminum. The long-term downturn in consumption has made the supply of aluminum even more serious, suppressing aluminum prices. Conclusion: The stable economic growth in the United States will maintain a good pattern of aluminum ingot consumption worldwide, and the stable reduction in inventories is also a favorable factor for short-term prices. However, the substantial reduction in open interest has opened up the room for falling prices. Therefore, it is expected that prices will remain stable in the third quarter under the premise of still good fundamental conditions, and the price will fluctuate in the interval, while the overall growth in the latter period will be in the process of decline. Shanghai Aluminum's current inventory pressure is increasing. With the increase in August's exports, the pressure is being released. The short-term aluminum price will be in a rebounding trading pattern. However, with the gradual fall in the price of alumina and the constraining of consumption, prices have been in a long-term downward trend. For late-stage investment opportunities, it is that after the price rebounded sharply this time, we should grasp such short-selling opportunities. Every step up in price is a good opportunity for us to sell short.
Grease GUN
SUZHOU CREATION SPACE INTELLIGENT TECHNOLOGY CO.,LTD , https://www.mypkey.com