Nandu Futures: LME closed higher, Shanghai Aluminum floated across the board

Last night, LME March aluminum closed up 28 US dollars, driven by the aluminum aluminum disk, Shanghai aluminum all across the board today, the main force of the Shanghai stock market to maintain the momentum of yesterday's rise to yesterday's opening at 16,950 yuan, a high of 17,260 yuan, to close at 17,080 yuan . At the same time, the number of positions and trading volume of 0511 today have declined, and the market bulls have weakened, and it is possible to call back after a continuous surge.

The rise of Shanghai Aluminum has come from the fundamentals of the entire market. Potential U.S. primary aluminum demand (based on the weight of the industrial production index) is still growing at a steady pace, while China’s primary aluminum demand continues to grow at a frantic pace. Strong industrial activities and strong semi-finished products have become the pillars of rapid growth. CRU expects that the world's primary aluminum consumption will increase by 4.5% to 31.7 million tons in 2005. Just over 20%. And China's consumption continues to grow at a crazy pace - in 2005 China's aluminum demand is expected to expand by 12.6%. In terms of policy, in order to cope with the 5% tariff increase on exports of electrolytic aluminum and aluminum products implemented at the end of this year, part of the company’s production plan for the fourth quarter will shift to exports. If demand increases, it may affect the domestic supply prospects of electrolytic aluminum in the short term. This will also lead to rising domestic relative demand and rising prices.

Even with strong demand, aluminum prices are unlikely to continue rising in the face of domestic supply levels. This should be short-term behavior.

Operational advice; Lun aluminum to see more, Shanghai aluminum continues to wait and see, waiting for the opportunity

Nandu Futures Lu Xiaohua