Arrival blocked, aluminum rod processing fees surge

The inventory of aluminum rods dropped rapidly this week. Guangdong aluminum rod stocks fell by more than 5,000 tons in two days, down from 27,200 tons last Friday to 22,000 tons. Inventories fell sharply, pushing up the processing costs of aluminum rods. As of Wednesday, Guangdong aluminum rod processing fees rose from the average price of 100 yuan to 100-250 yuan in the South Reserve last week. Some scarce models such as Φ90, Φ127, and Φ150 are more than 300 yuan above the average price of South Reserve.

The rapid decline in inventories was mainly due to the low impact of goods. According to the Nancun Business Network, the transportation in the Northwest and Shandong regions was poorly understood. Among them, the transportation problem in Xinjiang has not been eased, and the aluminum rod backlog problem is serious. Some aluminum rod plants have implemented measures to reduce production and stop production in order to ease financial pressure. In Gansu, as winter approaches, thermal coal transportation is tense, and local military exercises are performed again. The military occupies part of the wagons, resulting in further pressure on the transportation of materials. So far it has not been able to determine the end time of military exercises. The Gaoping station from Qinghai to Guangdong is being repaired. The train transportation is hindered. Some rod mills abandon the fire and transport it from Qiyun, preferring to increase transportation costs, and also transport aluminum rods to distribution centers to increase the speed of liquidation.

The consumption of aluminum rods in the downstream of Guangdong Province has been falling for two consecutive months. From the monthly data, the month of October has decreased from the previous month and increased by 36.9% year-on-year. From the chart below, we can see that after August, the outbound inventory is still higher than the same period last year, but it continues to decline, indicating that the downstream demand has weakened. It is understood that due to the continued high aluminum prices, the profits of processing aluminum plants are weak, and there are successive production cuts and delayed orders. As of yesterday, the volume of aluminum rods released in November was basically flat compared with the same period in October.

Arrival blocked, aluminum rod processing fees surge

In the event that the transport problem cannot be solved within a half hour, the space for aluminum rod processing costs is still large, and the average price is already at a relatively high position during the year. It is expected that the demand for aluminum rods will increase further at high processing fees and high benchmark prices in the later period. Turn weaker.