[SMM Analysis]Supported by demand, the operating rate of secondary aluminum producers remains high, but constrained by multiple factors, the operating rate of secondary aluminum alloy is expected to decline slightly in December.

Brief Review: At the beginning of the month, the December tender pricing set by leading downstream aluminum enterprises was officially finalized. The tender prices generally trended upward, settling in the range of 10,200-10,300 yuan/mt. With the clarification of tender prices, aluminum fluoride prices generally increased by 250-300 yuan/mt following this guidance. Cost side, the core raw material for aluminum fluoride, sulphuric acid, continued its strong price trend, providing solid support for aluminum fluoride costs. Meanwhile, the price of another key raw material, fluorite, experienced a pullback, alleviating some production pressure on enterprises and contributing to a slight improvement in industry profitability, which in turn boosted production enthusiasm. Demand side performance remains the main constraint in the current market, with no significant improvement in downstream procurement pace. The overall demand atmosphere remains mediocre, and effective synergistic support between supply and demand has yet to materialize. Subsequent attention should focus closely on dynamic changes in raw material costs and adjustments in the downstream procurement pace.

The weekly operating rate of leading domestic aluminum downstream processing enterprises fell 0.4 percentage points WoW to 61.9%, with the market continuing to show structural divergence. The operating rate of primary aluminum alloy remained stable at 60.2%, as long-term contract deliveries at major enterprises were steady, but high aluminum prices suppressed spot order transactions, with cautious demand side sentiment.

First, a review of the secondary aluminum alloy price trend in November:

Recently, as aluminum prices continued to fluctuate at highs, SMM surveyed some aluminum alloy casting manufacturers on their current and near-term production and operations. The findings are as follows: