MI aluminium stocks analysis: Shanghai stocks level out

Stocks of primary aluminium registered with the Shanghai Futures Exchange (SHFE) increased over the course of late June and July but seem to have levelled out just south of the 50,000t level in the last couple of weeks. The headline figure rose by a modest net 1,338t to 48,823t in the week to Thursday, only partly offsetting the previous week's 3,922t decline. LME stocks, meanwhile, edged a little lower still Thursday with activity still concentrated on Singapore. Lower arrivals here in the last few days have been a key factor in the incipient downtrend. However, low cancelled tonnage continues to cap the daily draw rate and there was no change on that front yesterday with fresh cancellations not quite matching draws. The ratio of cancelled tonnage was unchanged at a low 2.3%.