Inventory decline, weak consumption to keep SHFE aluminium rangebound ahead of CNY

Aluminium prices on the SHFE are expected to trade rangebound ahead of the Chinese New Year break as inventories shrink and consumption dwindles.
Social inventories of primary aluminium continued to decline this week. Stocks across eight consumption areas in China, including SHFE warrants, fell 18,000 mt from a week ago to stand at 1.264 million mt as of Thursday January 17, SMM data showed.
Limited shipping capacity in the north-west and output cuts at producers lowered arrivals at social warehouses while CNY stockpiling drove up downstream purchases.
SMM data showed that aluminium capacity cuts have amounted to 3.28 million mt/year since the start of 2018.
Aluminium consumption continues to weaken. Operating rates across aluminium sheet/plate, strip and foil are expected to slip to 64% in January,
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