SMM Nov 11 Aluminum Morning Meeting Minutes:
Futures: SHFE aluminum closed at 22,170 yuan/mt, plunging 2.74% to a new stage low. Prices broke below all moving averages from MA5 (22,795) to MA60 (23,711), with moving averages in an extremely bearish divergent alignment. MACD formed a death cross below the zero axis, with the green bar expanding to -150.62, indicating strong downward momentum; trading volume shrank to 163,700 lots, with extremely scarce buying interest. The core trading range for SHFE aluminum is suggested at 22,000-22,700. LME aluminum closed at $3,017.5/mt, tumbling 2.09% and approaching the 3,000 mark. Prices also broke below all moving averages (MA5=3,059.2), showing pronounced weakness. MACD red bar narrowed sharply to 12.44, with DIF turning downward and about to form a death cross; trading volume expanded to 35.71K lots, with notable selling pressure. The core trading range for LME aluminum is suggested at 2,950-3,050.
Macro front: US President Trump stated that the US-Iran war has effectively ended at the military level, and there appears to be no need for further military action at present, with the situation moving toward ending the conflict. However, Trump also emphasized that the US will continue to maintain a maritime blockade on Iran and retain the capability to resume military action if necessary. US October CPI rose 0.4% MoM, higher than economists' consensus expectation of 0.3%; core CPI held flat at 0.3%, also above market expectations of 0.2%. Currently, traders have fully priced in a 25bp rate hike by the US Fed in December, while also factoring in the possibility of a larger 50bp hike. US October inflation once again exceeded market expectations, triggering a sell-off in US Treasuries, with the 2-year Treasury yield briefly surging 20bp to 4.767%;
Fundamentals: Supply side, China's operating aluminum capacity remained high, and this week's weekly aluminum production continued to edge up; overseas, production resumptions at Middle Eastern capacity under production cuts progressed slightly faster than expected, and with new capacity in Indonesia gradually coming online, aluminum supply continued its recovery trend. LME aluminum inventory remained near a 20-year low at around 229,000 mt. Demand side, the aluminum processing industry composite PMI fell below the 50 mark to 48.9% in October, with increasing signals of weakening downstream processing demand as the peak season drew to a close, and downstream purchases were mainly need-based restocking. Inventory-wise, according to SMM statistics, as of this Monday, China's aluminum ingot social inventory destocked by 14,000 mt from last Thursday and by 40,000 mt from last Monday. Exports-wise, October unwrought aluminum and aluminum semis exports stood at 594,000 mt, down 62,000 mt or 9.5% MoM from September's 656,000 mt, but still up 18.1% YoY; January-October cumulative exports reached 5.916 million mt, up 17.9% YoY. Aluminum semis exports were the most resilient demand-side component this year, with monthly MoM growth turning from positive to negative, and the market widely expects November exports to continue declining MoM amid inverted domestic and overseas prices.
Primary aluminum market: East China market: In early trading, SHFE aluminum shot up then retreated and continued to fall, with spot market buying sentiment improving. Spot buying sentiment stabilized, with spot prices against the SHFE aluminum 2611 contract stabilizing near a discount of 20 yuan/mt. During the day, SMM A00 aluminum ingot prices traded at discounts of 30-10 yuan/mt. Central China market: Entering November, the central China market officially began environmental protection-driven production restrictions. Downstream processing enterprises were affected by insufficient earlier orders, and although operating rates were lowered again, the magnitude was relatively small, with overall market buying sentiment remaining at low levels. Ultimately, actual transaction prices in the central China market centered around discounts of 110-130 yuan/mt against the SHFE aluminum November contract. South China market: Yesterday, aluminum prices turned sharply lower, and the spot market remained weak. Arrivals increased somewhat, inventory destocking slowed, and the wide price spread could attract additional replenishment going forward. Coupled with high basis levels for next-month and far-month contracts, bearish expectations for the future strengthened, prompting increased selling to monetize. Mainstream quotes gradually moved lower from discounts to parity, with discount-priced supply relatively ample. Demand-side dip-buying and restocking increased somewhat, but under the influence of bearish sentiment, incremental demand was relatively lacking; buyers only accepted cargoes at deeper discounts for delivery, with almost no additional market participation, resulting in poor transactions. Spot transaction prices concentrated at premiums of 255-295 yuan/mt against the SHFE aluminum 2611 contract.
Aluminum scrap: Yesterday, SMM A00 aluminum prices closed at 23,290 yuan/mt, down sharply by 250 yuan/mt MoM from the previous trading day. The aluminum scrap market declined broadly, with some regional varieties holding steady amid a wait-and-see stance. Supply side, tax inspections in multiple regions continued to deepen, with compliant invoiced aluminum scrap scarcity showing no signs of easing. Enterprises holding invoices maintained a strong willingness to hold prices firm, and most scrap quotes held steady at the start of the week amid a wait-and-see stance. Demand side, off-season characteristics began to emerge. With scrap costs remaining high while finished product price hikes proved difficult, theoretical profits were compressed, and scrap utilization enterprises' willingness to chase higher prices for purchases weakened notably. Wrought aluminum alloy enterprises continued to push for lower prices, with downward pressure on wrought aluminum alloy scrap continuing to be released. In the short term, the combination of weakening primary aluminum support, increased import arrivals, and insufficient demand as the off-season begins has significantly weakened upward momentum, with prices more likely to follow primary aluminum lower before showing resistance to further declines. By variety, aluminum tense scrap remained relatively firm, supported by cast aluminum alloy orders and low inventory, while wrought aluminum alloy scrap still faces the possibility of catching down under pressure from wrought aluminum alloy enterprises. Going forward, key focus areas include the spread of tax inspections and changes in invoicing quotas across regions, the actual realization of primary aluminum substitution after the price difference between A00 aluminum and aluminum scrap compresses to low levels, and the slope of downstream operating rate declines during the off-season.
Secondary aluminum alloy: Yesterday, ADC12 market quotes were broadly lowered by 100 yuan/mt, largely giving back the previous day's gains. Primary aluminum prices and futures weakened sharply, with market bearish sentiment heating up and spot prices under pressure and pulling back. Meanwhile, current downstream purchases remained primarily need-based, with demand lacking clear growth and providing relatively limited support to prices. Against the backdrop of weak raw material and futures trends and subdued end-user purchasing enthusiasm, market quotes showed signs of loosening. In the short term, ADC12 prices are expected to adjust narrowly, with attention needed on raw material price changes and actual downstream purchasing conditions.
Comprehensive outlook: Yesterday's futures decline represented the concentrated realization of three factors: "exports turning negative MoM + expectations of a far-month surplus + inventory marginally turning higher." Capital flows showed position-building on the downside with far-month contracts leading the decline, reflecting a correction in expectations and structure rather than a collapse in spot fundamentals. Considering that social inventory absolute levels remain at five-year lows, overseas visible inventory has hit a 30-year low, and spot premiums remain high, downside room for aluminum prices is limited.
[The information provided is for reference only. This document does not constitute direct investment research or decision-making advice. Clients should make decisions prudently and not use this as a substitute for independent judgment. Any decisions made by clients are not related to Shanghai Metals Market.]
![November 11, 2026 SMM Daily Inventory Data of Aluminum Ingots in Three Regions [SMM Data]](https://imgqn.smm.cn/usercenter/iCOMR20251217171653.jpg)
