MI aluminium stocks analysis: Holding highs

The LME headline figure is holding close to the year’s highs—last Thursday’s 838,275t—with yesterday bringing a small net rise after two “down” days. Both “in” and “out” activity were subdued yesterday. Fresh arrivals continue to be biased towards Asia, where Johor was in action again. This Malaysian location has seen 6,275t warranted over the last week. That and a strong flow of metal into Singapore in recent weeks suggests a well-supplied local market—probably reflecting the displacement effect of China’s huge exports of aluminium “product” (see yesterday’s MI). Draws were the lowest daily total in several weeks, largely due to the absence of Trieste, even though it still has 4,275t sitting in the cancelled category. However, falling cancelled tonnage—the ratio is now at 2.8%--will mitigate against any sustained acceleration in “out” side activity even if Trieste re-activates in the next couple of days.