Macro sentiment still shows no significant improvement, aluminum prices remain in the doldrums [SMM Aluminum Weekly Review]

Published: Feb 12, 2026 18:52

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[SMM Aluminum Weekly Review: Macro Sentiment Remains Lackluster, Aluminum Prices in the Doldrums]

SMM February 12 News:

Macro perspective, domestically, the overall macro sentiment is positive, while overseas expectations for an interest rate cut have pulled back. The National Bureau of Statistics (NBS) announced that China's CPI rose 0.2% MoM and PPI increased 0.4% MoM in January, alleviating deflationary pressures. Overseas, the US added 130,000 non-farm jobs in January, with the unemployment rate dropping to 4.3%, and a downward revision of 862,000 for the year. The market faces a contradiction between strong monthly data and weaker historical data revisions, pushing back expectations for a rate cut to mid-year or later; US Fed officials took a more hawkish stance, favoring maintaining restrictive interest rates, with Trump continuing to pressure the Fed.

Fundamentally, on the supply side, domestic and Indonesian aluminum projects are steadily ramping up production, but due to fewer natural days in February, overall production declined MoM from January. Domestically, as the Chinese New Year approaches, downstream demand for raw materials has weakened at the margin. Coupled with high aluminum prices, which suppress demand, enterprises' willingness to cast ingots has significantly increased, leading to a lower proportion of liquid aluminum in February. Although warehouse withdrawals of aluminum ingots in major consumption areas were up YoY this week, social inventory built up by about 35,000 mt compared to last Thursday.

Overall, bullish sentiment in the non-ferrous metals market has cooled, coupled with high inventory pressure, causing aluminum prices to be in the doldrums this week. Affected by the approaching delivery date, SMM A00 aluminum premiums and discounts were reported at -160 yuan/mt on Thursday, narrowing by about 20 yuan/mt from the previous trading day. With no significant boost in macro sentiment and high inventory suppression, SHFE aluminum is expected to remain in the doldrums after the Chinese New Year, with a price range of 22,800-24,000 yuan/mt. LME aluminum is expected to trade within the range of $3,080-3,180/mt. Additionally, attention should be paid to the potential impact of rising alumina prices on aluminum prices after the holiday.

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM‘s internal database model. They are for reference only and do not constitute decision-making recommendations.

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