September 17, 2026
According to SMM statistics, as of September 11, days of in-factory inventories at aluminum rod plants in China recorded 8.06 days, up 0.43 days WoW; the inventory ratio rose from 100.95% to 102.86%, up 1.91 percentage points. Looking at the trend over the past five weeks, inventories continued to consolidate at highs, with the inventory ratio staying above 100% in the upper range for the year, as destocking and restocking alternated without a clear one-way trend. Over the same period, the combined operating rate of industry leaders in the aluminum rod sector recorded 72.50%, down 0.46 percentage points WoW, pulling back slightly after stabilizing at 72.96% for three consecutive weeks, and overall remaining at low levels. The combination of inventories consolidating at highs and a slight pullback in operating rates reflects that the current oversupply in aluminum rod has yet to change, the earlier downstream restocking pulse has faded somewhat, market buying sentiment has weakened marginally, and production schedule enthusiasm at plants remains subdued. With oversupply yet to see any meaningful easing, inventories are expected to continue to consolidate at highs; operating rates, constrained by the supply-demand imbalance, are likely to stay at low levels in the near term. Attention should be paid to the boost to production schedules from the restart of power grid projects and export orders in late September.
During the week, aluminum prices overall retreated after a rapid rise and then stabilized at low levels, pulling back from 24,460 yuan/mt last Tuesday (September 8) to 24,140 yuan/mt this Tuesday (September 15), a cumulative decline of about 320 yuan/mt. In the latter half of the week, prices moved sideways in a narrow range of 24,140–24,180 yuan/mt, with the center clearly lower WoW. The retreat from highs in aluminum prices provided some support to processing fees. As of September 15, processing fees for aluminum rod by region showed divergent performance compared with last Tuesday (September 8): Shandong reported 150 yuan/mt (flat), Inner Mongolia reported 75 yuan/mt (down 25 yuan/mt), Henan reported 300 yuan/mt (up 50 yuan/mt), Jiangsu reported 350 yuan/mt (up 50 yuan/mt), Hebei reported 250 yuan/mt (up 50 yuan/mt), and Guangdong reported 400 yuan/mt (up 50 yuan/mt). Processing fees in most regions recovered and rebounded, driven by the pullback in aluminum prices, easing cost-side pressure, and pre-holiday downstream restocking, with Henan, Jiangsu, Hebei, and Guangdong all rising 50 yuan/mt in tandem. Shandong held steady at low levels, while Inner Mongolia remained at extremely low levels nationwide due to ample regional supply and intense brand competition. Given that the current oversupply in aluminum rod has yet to change and inventories are consolidating at highs, upside room for processing fees is limited. However, if aluminum prices continue to consolidate on a subdued note, the center of processing fees is expected to keep edging higher, with regional divergence persisting.
The operating rate of China's aluminum wire and cable industry rose to 64.6% this week, up 0.6 percentage points WoW. During the week, production within the industry showed a divergent trend: leading wire and cable enterprises saw solid order performance, with production line loads picking up again and driving the operating rate higher; small and medium-sized enterprises still faced insufficient orders, with a slower pace of production resumptions, and the overall industry downturn has not yet been fully reversed. On the order side, power grid projects under State Grid and China Southern Power Grid advanced steadily, and expectations for Q4 order realization remain; however, the actual pace of cargo pick-up has yet to ramp up, and downstream procurement remains cautious, constraining short-term order release. On the export side, overseas demand for aluminum stranded wire maintains a dynamic window, but new order growth is limited and unlikely to become a major support. Overall, the industry remains weighed down by weak orders in the short term, limiting upside room for the operating rate; but as power grid projects enter the Q4 delivery peak, demand is expected to gradually recover, and the operating rate is expected to rise further.
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