Post-Holiday Downstream Recovery Slows; February Operating Rate of Secondary Aluminum Producers Fluctuates Downward [SMM Analysis]

SMM News, March 7:

Operating Rates of Secondary Aluminum Alloy Enterprises by Region in February 2025 Survey Data: Operating Rates of Secondary Aluminum Alloy Enterprises by Scale in February 2025

Survey Data:

According to SMM survey statistics, the operating rate of the secondary aluminum industry in February 2025 decreased slightly by 1.9 percentage points MoM to 32.9%, marking the third consecutive month of decline.

Affected by the Chinese New Year holiday, most secondary aluminum enterprises shut down furnaces and took holidays in early February. Combined with delayed post-holiday resumption and fewer natural working days, the overall production of the industry generally contracted. However, as some enterprises had already entered holiday shutdowns in January, the decline in the operating rate for the month was relatively limited.

After the holiday, as the supply side gradually recovered, downstream die-casting enterprises experienced slow resumption progress due to insufficient growth in orders and significant aluminum price fluctuations. Their purchase willingness remained sluggish, and market sentiment was dominated by a wait-and-see attitude. Most enterprises focused on digesting pre-holiday inventory or maintaining rigid restocking, with weak demand-side support highlighting supply pressure in the industry. Intense market price competition led to frequent occurrences of low transaction prices.

In March, although secondary aluminum consumption showed seasonal mild recovery signs, downstream die-casting enterprises generally reported insufficient momentum in new orders, with some enterprises even experiencing YoY declines in order volumes. It is expected that the operating rate in March will rebound slightly due to the normalization of production rhythms. However, constrained by the weak end-use demand, the overall recovery is likely to be limited.

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Data Note: This survey covered a total capacity of 12.7 million mt.

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