Trader points out: China's aluminum premium has weakened in the Singapore market

A few days ago, Singapore’s aluminum premium has fallen by more than half. Dealers pointed out that before China’s export tax rebate could be lifted, there was a large number of Chinese aluminum supplies on the Singapore market, which was the reason for the decline in premium. LME aluminum has a premium to spot aluminum, which means that the spot price is higher than the LME futures price, which also puts a lot of pressure on the seller, prompting them to reduce the premium. The market is widely expected that in order to curb the overheated economy, the Chinese government will cancel the 8% export tax rebate from January 1st next year. Therefore, in order to catch up with the “last train”, domestic manufacturers have increased their export efforts. By November 4, LME's aluminum stock in Singapore had reached 119,025 tons, which was more than 10% higher than in mid-October. Which China's aluminum stocks increased more, while India's stocks have declined. Inventories of aluminum in China's aluminum stocks in Singapore have been maintained at between US$10 and US$20 per ton (compared to current LME prices), which is much lower than US$30 to US$35 per ton in mid-October. In the past two months, the spot price of LME rose by almost 12%, and it closed at US$1,845-1,847/tonne on November 4. Source: China Nonferrous Metals

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