[SMM Spot Aluminum Midday Review: Downstream Demand Gradually Declines, Spot Premiums Under Pressure] Under the high price spread between futures contracts structure, suppliers are facing increased pressure to hold inventory, and are more motivated to sell. However, downstream consumption has begun to weaken, with some processed materials operating at reduced capacity. The market is generally trading at a discount of 10 yuan/mt to the SMM benchmark.

June 9 News: According to SMM statistics, on June 9, the inventory of aluminum ingots at major domestic consumption centers stood at 477,000 mt, a decrease of 27,000 mt from last Thursday and a decrease of 34,000 mt from the end of May.

Details of the hot topics in the aluminum market in May are as follows......

[SMM Aluminum Morning Meeting Summary: Destocking Provides Support for Aluminum Prices During Off-Season, Prices Expected to Fluctuate Considerably] On the macro side, the phone call between China and the US may lead to a de-escalation of the trade war, while the rebound in China's manufacturing PMI and improvement in export indicators in May provide demand support, indicating that the resilience of the domestic economy remains. Fundamentals side, the operating capacity of domestic electrolytic aluminum remains stable, and the reduction in casting ingot volume has temporarily maintained the destocking trend of domestic aluminum ingot inventory. Cost side, the impact of the Guinea mine incident on alumina prices has eased somewhat, and the real-time cost of electrolytic aluminum has declined slightly MoM. On the demand side, it faces dual pressures from domestic seasonal weakness and trade uncertainties. In the short term, the operating rate of domestic aluminum processing enterprises will be under pressure, and the off-season atmosphere will intensify. Overall, the current low inventory and the expectation of a higher proportion of liquid aluminum provide strong support for aluminum prices. However, the off-season pressure on the demand side limits the upside room. Spot aluminum ingot in major consumption areas may soon face a situation of weak supply and demand, and aluminum prices are expected to remain volatile and range-bound in the short term.

During this period, the tender pricing for June by downstream benchmark aluminum enterprises was finalized. The market price of aluminum fluoride continued to weaken, with the tender price of benchmark enterprises in June declining by 150-200 yuan/mt to 9,630-9,700 yuan/mt. Currently, the aluminum fluoride market continues to experience weak supply and demand. After entering June, prices of both raw materials and finished products have declined, and corporate profitability has not improved. Most enterprises are experiencing losses, with low operating rates that are unlikely to increase in the short term. Coupled with the absence of positive factors on the demand side, aluminum fluoride prices are expected to remain stable in the short term. Additionally, with the anticipated decline in raw material prices in June, prices are expected to remain weak next month.

A certain aluminum enterprise in Shandong has adjusted the benchmark tender price for prebaked anodes in June 2025, which remained flat MoM. Meanwhile, a major domestic prebaked anode sales company simultaneously lowered its sales pricing, with a MoM decrease of 142 yuan/mt. Despite varying performances in the raw material market, overall costs have declined. According to SMM data, as of June 6, the comprehensive cost of prebaked anodes in China fell to 4,670 yuan/mt, a significant decrease of 6.32% from May 9. The reduction in cost-side pressure has supported the industry's profitability. Based on a one-month production cycle, the profitability of the prebaked anode industry has significantly improved, with theoretical profitability increasing by approximately 350 yuan/mt MoM. Most prebaked anode enterprises are now in a state of marginal profitability. Entering June, domestic refinery maintenance and production resumptions coexist, with overall supply-side fluctuations remaining relatively small. However, with the continuous arrival of overseas petroleum coke and weak domestic demand, port inventories of petroleum coke have continued to rebound, resulting in a relatively abundant supply in the petroleum coke market. On the demand side, the operating rate of the prebaked anode industry is high, but enterprises' procurement enthusiasm is low, preferring a strategy of restocking at low prices. Meanwhile, orders in the anode material and graphite electrode markets are weak, and the previous stockpiling by glass and cement plants has been largely completed, leading to weakened demand. Therefore, the demand side remains generally sluggish. SMM expects petroleum coke prices to continue their downward trend in June, thereby exerting a sustained impact on the cost side of prebaked anodes. Considering the aforementioned factors, SMM expects prebaked anode prices to remain in the doldrums next month.