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SMM Morning Comment For SHFE Base Metals (Jun 5)
Overnight, LME copper opened at $9,640/mt, touching a low of $9,603.5/mt shortly after the opening bell.
Bank of Canada Holds Steady as Expected, But Says Future Interest Rate Cut Possible
[SMM Aluminum Morning Meeting Summary: Trade Negotiations Ongoing, Aluminum Prices Under Short-Term Pressure and Fluctuation] The US Fed's Beige Book revealed a slowdown in US economic activity and excessive inflationary pressures, while policy uncertainties heightened market risk aversion. Companies transferring costs amid the economic environment may suppress end-use demand, coupled with international trade friction risks, aluminum prices are likely to face short-term pressure and maintain a fluctuating trend. Fundamentals side, domestic aluminum operating capacity remains stable. Notably, some aluminum smelters in north China increased the proportion of liquid aluminum alloying, reducing casting ingot volumes, which affected arrivals in major consumption areas. Demand side, downstream sectors show signs of off-season expectations, with PV aluminum demand declining. Automotive material demand is expected to weaken in mid-to-late June, while construction aluminum demand remains lukewarm. However, aluminum wire and cable operating rates stay high, supported by orders from State Grid. Inventory side, approaching the holiday, some aluminum processing enterprises conducted slight stockpiling based on orders on hand. Overall, short-term market sentiment may weigh on aluminum prices due to tariff impacts, while stronger-than-expected domestic aluminum ingot inventory drawdowns provide support for prices and spot premiums. Some industries already exhibit off-season weakness, but the overall decline is better than expected, with demand resilience persisting. SHFE aluminum is expected to maintain a fluctuating trend in the short term, with solid support at lower levels.
