Aluminium stocks in warehouses monitored by the Shanghai Futures Exchange (ShFE) rose by more than 10,000 tonnes last week to around 747,000 tonnes, an unusually high number for this time of year <AL-STX-SGH>.
"Inventory is still at a high level and the electrolytic aluminium costs - such alumina, anodes, etc - continue to move downward," Huatai futures said in a note, expecting the aluminium price to remain weak for the rest of the quarter.
Smelting capacity additions this year will put further pressure on prices, the brokerage said, adding that a rebound may only occur if there are enough production shutdowns to leave the market short.
Winter restrictions on aluminium production in northern China are due to be lifted at the end of next week.
FUNDAMENTALS
* SHFE ALUMINIUM: The most traded May ShFE aluminium contract fell as much as 1 percent to 13,430 yuan ($2,001.88) a tonne, the lowest since Feb. 15 and stood at 13,460 yuan a tonne by the end of the morning.
* LME ALUMINIUM: Three-month aluminium on the London Metal Exchange declined as much as 0.4 percent to a two-week low of $1,858 a tonne.
* RUSAL: The world's largest aluminium producer outside China expects global aluminium demand to rise by 3.7 percent in 2019 to 68 million tonnes.
* OTHER METALS: Three-month LME copper slipped 0.4 percent to $6,441.50 a tonne, while ShFE copper edged down 0.2 percent to 49,340 yuan a tonne as most base metals lost ground. Only LME lead and tin were higher.
* COPPER SPREADS: The premium of cash LME copper over the three-month contract <CMCU0-3> stood at $31.50 a tonne on Wednesday, less than half the previous day's $70 a tonne in a sign of easing supply tightness.
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MARKETS NEWS
* Asian shares eased, with caution prevailing as investors awaited some kind of resolution to Sino-U.S. trade negotiations, while the euro remained under pressure ahead of the European Central Bank meeting.