SMM

Since the holiday, domestic aluminum ingot inventory has performed well. As of October 17, 2024, SMM statistics show that domestic aluminum ingot social inventory was 648,000 mt, and domestic circulating aluminum inventory was 522,000 mt, continuing to decrease by 8,000 mt from this Monday and down 29,000 mt from last Thursday. Since the holiday, a total of 36,000 mt has been destocked. On YoY terms, domestic aluminum ingot inventory was only 12,000 mt higher than the historical post-holiday level of 636,000 mt last year, continuing to show a narrowing trend. Additionally, inventory has decreased by 10,000 mt compared to pre-National Day levels, meaning the inventory buildup during the National Day holiday has been fully consumed, marking the end of the aluminum ingot inventory buildup in the first half of October. However, there has been no sign of easing in the transportation capacity shortage in Xinjiang. The Xinjiang Railway Bureau prioritizes coal transportation, and this situation is expected to ease by late October. As a result, the current aluminum inventory pressure is not significant, but there is a need to be cautious about the risk of increased arrivals in the future. SMM expects domestic aluminum ingot inventory to hover around 600,000-700,000 mt in the second half of October, with the possibility of dropping to around 600,000 mt by the end of October under optimistic conditions. We should pay close attention to downstream consumption under high aluminum prices and the smoothness of shipments from major supply sources.