SHANGHAI (Scrap Register): Aluminum prices in China are expected to continue to trade range bound at highs this week, as it remains unclear whether consumption will substantially pick up, according to SMM.

The most active SHFE May contract is likely to trade at 13,550-13,800 Yuan/MT this week.

Supply held relatively stable. Production cuts around the CNY break mostly occurred at aluminum smelters of the Aluminum Corp of China (Chalco). Yunnan Aluminum and Baikuang Aluminum added new capacity and Weiqiao Group resumed capacity.

Prices of alumina are expected to see further downside room. The three-month LME aluminum is also likely to trade range bound this week with a range of $1,880-1,930/MT, as improved overseas supplies limit upward momentum in LME aluminum.

In the physical market in China, downstream consumers recovered from the holidays. Producers of aluminum wires and cables and industrial aluminum extrusions in the east reported modest orders. Spot discounts in Shanghai are seen at 60-40 Yuan/MT against the SHFE March contract this week.