On April 10th, the data released by the London Metal Exchange (LME) showed that in March, the share of available aluminum inventories of Russian origin in LME-registered warehouses soared sharply from 75% in February to 88%, while the share of aluminum inventories of Indian origin plummeted from 24% to 11%. As of the end of March, the available or registered aluminum inventories of Russian origin climbed to 200,700 tons, compared with 155,125 tons at the end of February, and the aluminum inventories of Indian origin decreased from 49,400 tons to 25,050 tons.
Downstream in the metal industry chain, aluminum sheets, aluminum bars and aluminum tubes, as important aluminum materials, are widely used in fields such as construction, automobiles, and electronics. The machining process endows aluminum materials with precise shapes and properties, meeting the diverse needs of various industries. These fields are closely linked to the dynamics of aluminum inventories, and changes in inventories often have a far-reaching impact.
Since April 13, 2024, in order to comply with the sanctions imposed by the United States and the United Kingdom regarding the Russia-Ukraine conflict, the LME has prohibited the creation of new warrants for Russian aluminum, copper, and nickel. However, the share of Russian aluminum in LME warehouses has increased significantly against the trend. Analyzing from the perspective of the application of aluminum materials, the shift in market demand for aluminum sheets, aluminum bars and aluminum tubes may be a potential factor leading to the change in the structure of aluminum inventories.
On the one hand, the outflow of Indian aluminum from LME warehouses has correspondingly increased the proportion of Russian aluminum in the remaining inventories. This may be due to the adjustment of the competitive strategies of Indian aluminum materials in the markets of aluminum sheets, aluminum bars, and aluminum tubes, reducing the supply to LME warehouses and making room for Russian aluminum. For example, a large Indian aluminum enterprise reduced its export volume of aluminum sheets for construction in the European market, resulting in a decrease in the reserves of Indian aluminum in LME warehouses.
On the other hand, Russia previously had a large base of aluminum inventories in LME warehouses, and when aluminum from other origins flowed out, its relative share became more prominent. Relying on its advantages in the supply of high-end machined aluminum materials such as aluminum bars for aerospace and aluminum tubes for high-end electronic devices, Russia maintained a large amount of inventories. When Indian aluminum flowed out, its share naturally increased.
The change in the share of Russian aluminum in LME warehouses this time may subsequently have a chain reaction on the prices of aluminum sheets, aluminum bars, aluminum tubes and the costs of the machining industry, which deserves the close attention of the entire industry.
Post time: Apr-14-2025