Monday: What is alumina trading? According to the early morning news on May 21 overseas, Rio Tinto Group announced the force majeure factor on the alumina shipment from Yarwun Smelter in Australia and Queensland Alumina Co., Ltd., saying that the natural gas inventory/supply for power generation is short. Stimulated by this news, the main contract of alumina hit the limit of rise at 4159 yuan/ton in the morning of May 21. The accident affected the production capacity of Tuo's two alumina plants of 1.2 million tons, accounting for about 0.7% of the total global alumina production capacity. In the early stage, the two alumina enterprises are expected to resume production around the beginning of June, but at present, the local natural gas supply has not been fully recovered, and it is expected to be postponed to September. Since the beginning of the year, the price of alumina has been running at a high level. The core is limited by the suspension of bauxite production in Shanxi, Henan and other places in China. The limited operating capacity of alumina has led to a shortage of cash. Events in the week have further catalyzed the price rise.
Base metal: COMEX copper rose and fell, and the supply side supported the rise of aluminum price. 1) Copper: Copper prices rose and fell this week, and Shanghai copper closed at 83490 yuan/ton. Major central banks around the world took a hawkish stance this week. Investors lowered their expectations for interest rate cuts. The current situation of the spot copper industry was weak, and the withdrawal of some funds triggered a copper price correction. In terms of fundamentals, the average TC price of imported copper ore this week was $1.5/ton. In the early stage, the TC cost continued to decline, and the smelter's profit was affected by the rise in the ore end price. As the alternative cost performance of crude copper and scrap copper began to appear, the price difference between refined and scrap expanded, resulting in the expected production reduction not reached. On the demand side, the downstream has a low acceptance of the current price, the performance of superimposed orders is low, the demand for raw materials is reduced, and the market trading is very cold, so most enterprises are forced to choose to reduce production, stop production and reduce production. Most enterprises said that copper prices continued to fall, the market was bearish, and downstream enterprises were cautious in purchasing. 2) Aluminium:
During the week, the price of Shanghai Aluminum fell first and then rose, closing at 21015 yuan/ton. The earlier decline mainly followed the copper price adjustment, and the price change mainly followed the copper price trend. In terms of supply, electrolytic aluminum enterprises in Yunnan continued to release production capacity. So far, the capacity of electrolytic aluminum industry started this week is 42.916 million tons, an increase of 65 million tons compared with last week. In terms of demand, the aluminum plate enterprises started relatively stably, but the aluminum rod enterprises increased production. In terms of inventory, the social inventory of aluminum ingots increased this week. At present, the inventory is 796900 tons, 11100 tons more than 785800 tons last week. The domestic aluminum ingot import window has not been opened, LME aluminum ingots cannot flow into China temporarily, and the internal price has certain support. Suggested attention: China Hongqiao, Chinalco, Luoyang Molybdenum, Zijin Mining, Jincheng, Minmetals Resources.
Precious metals: long profits, gold and silver prices rose and fell. On May 20, it was reported that the helicopter of the President of Iran and the Foreign Minister crashed while crossing the mountains in the thick fog. The geopolitical conflict between Palestine and Israel was likely to further deteriorate. The market's risk aversion was further enhanced. The spot gold price hit a one month high of $2440.61 per ounce, and the spot silver price also stood at the threshold of $32 per ounce in the intraday trading, hitting a new high in more than a decade. Then the price of precious metals rose and fell back. We believe that the main reason is that COMEX copper closing sentiment subsided, which suppressed the overall commodity speculation, and gold and silver speculative funds showed signs of leaving the market at a high level. The interest rate gap between the US and Europe continues to widen in the future, which may exert an incremental negative impact on precious metals. Suggested attention: Shandong Gold, Yintai Gold, Zhaojin Gold, Zhongjin Gold.
Small metals: the contradiction between supply and demand is difficult to solve, and tungsten prices hit a new high. As of May 24, the price of 65% tungsten concentrate had risen to 157500 yuan/ton, a record high. Since the beginning of the year, due to the influence of the NPC and CPPCC and the safety and environmental protection supervision, some tungsten mines have stopped production, resulting in a tight supply of tungsten mines in the market. Recently, some mines have gradually resumed production, but the output is still lagging behind. We believe that the performance of tungsten prices that continue to break through this year is mainly driven by the contraction of the supply side. The current shortage situation on the supply side is difficult to ease, and tungsten prices are expected to continue to break through and rise. Suggested attention: China Tungsten High tech, Xiamen Tungsten Industry Risk Tips: the risk of demand recovery not as expected, the risk of large increase in upstream supply, and the risk of large increase in inventory.
