Ore Price Pullback Drives Cost Center Downward; Alumina and SHFE Aluminum Prices Under Pressure [SMM Aluminum Futures Brief]

》Check SMM Aluminum Product Prices, Data, and Market Analysis

SMM, March 19:

Today, the most-traded SHFE aluminum 2505 contract opened at 20,650 yuan/mt, with a high of 20,770 yuan/mt, a low of 20,570 yuan/mt, and closed at 20,705 yuan/mt, up 0.27%. Trading volume was 10,600 lots, and open interest was 240,000 lots.

SMM Comments: From a macro perspective, overseas trade protection and slowing growth created a bearish resonance: US trade policies focused on differentiated tariffs and export controls, while Fitch downgraded its 2025 US economic growth forecast to 1.7% and warned that tariffs could push up inflation, potentially delaying the US Fed's interest rate cut to Q4 2025. Domestically, the trade-in policy continued to gain momentum, with three departments promoting the scrappage and renewal of high-emission trucks. Coupled with a 1.3% YoY increase in total electricity consumption nationwide from January to February, the divergence between domestic and international markets persisted. Fundamentals side, the aluminum industry chain showed significant bullish signals: China's aluminum ore imports in February rose 28.3% YoY, aluminum ingot inventories in Guangdong, Wuxi, and Gongyi decreased slightly by 1,500 mt to 719,400 mt, and LME aluminum inventories also fell by 0.82%. The traditional peak season effect of "Golden March and Silver April" continued to manifest, and the supply-demand structure kept improving. Aluminum prices are expected to be more likely to rise than fall in the near term, fluctuating downward. In the short term, close attention should be paid to changes in US tariff policies and the actual release of downstream demand.

Today, the most-traded alumina 2505 contract opened at 3,057 yuan/mt, with a high of 3,062 yuan/mt, a low of 3,002 yuan/mt, and closed at 3,015 yuan/mt, down 1.47%. Trading volume was 112,000 lots, and open interest was 225,000 lots.

SMM Comments: Recently, the tug-of-war between alumina buyers and sellers continued, with sporadic spot transactions in the alumina spot market and transaction prices showing further slight declines. The domestic alumina export window has closed, and the total registered warrant volume in alumina futures delivery warehouses exceeded 280,000 mt. Subsequent alumina exports and transfers to delivery warehouses may struggle to provide sustained demand. Fundamentals side, in the short term, alumina operating capacity is expected to increase and decrease simultaneously, with no significant decline in total operating capacity anticipated. The alumina fundamentals are expected to maintain a slight surplus pattern, and spot alumina prices are likely to fluctuate downward in the short term.

[The information provided is for reference only. This article does not constitute direct investment research advice. Clients should make prudent decisions and not substitute this for independent judgment. Any decisions made by clients are unrelated to SMM.]