SMM Aluminum Downstream Analysis: Structural Recovery in Aluminum Processing Industry PMI in March—Peak Season Drive Fails to Mask High Aluminum Prices and Export Pressure Concerns. In March 2025, the composite PMI of China's aluminum processing industry rose to 61.6%, entering the expansion territory, driven by policy dividends and peak season effects, leading to a structural recovery. Aluminum plate/sheet and strip (63.3%) and aluminum foil (69.3%) benefited from automotive/battery demand and the trade-in policy but were constrained by India's anti-dumping measures and declining overseas orders. New orders for construction aluminum extrusion exceeded 70%, while industrial aluminum extrusion maintained expansion due to new energy/PV demand, but small and medium-sized enterprises faced over 50% idle capacity due to technological bottlenecks. The production index for aluminum wire and cable surged to 73.05%, leading the industry, driven by ultra-high voltage order placement in advance and power grid delivery dates, resulting in full-scale production. The PMI for secondary aluminum surged by 27.7 percentage points to 70.4%, but high aluminum prices suppressed purchases, leading to weak recovery in the primary sector and inventory risks in the secondary sector. Although the new PV policy in April and the peak season for power grids are expected to sustain some growth momentum, aluminum prices exceeding 21,000 yuan/mt may suppress purchase willingness, coupled with export pressure and surplus capacity among small and medium-sized enterprises, limiting the overall upside room for the industry.

On March 28, 2025, the operating rate of leading domestic aluminum wire and cable enterprises reached 60%, up 2% WoW, maintaining an upward trend. Recent operating data shows that the operating rate in the aluminum wire and cable industry is steadily increasing, primarily due to the approaching concentrated delivery phase of power grid project-related orders in April, coupled with the implementation of new orders. Enterprises are intentionally rushing to deliver orders in advance to increase finished product inventories. As the construction progress of ultra-high voltage and power transmission and transformation projects accelerates, the pressure for cargo pick-up in the industry is expected to grow daily, forcing enterprises to improve capacity utilization rates and further increase operating rates.

On March 28, China’s Ministry of Industry and Information Technology released a new Action Plan (2025–2027) for the aluminium industry, aiming to boost resource security, green development, and technological innovation. Key targets include a 3–5% increase in domestic bauxite reserves, 15 Mt of recycled aluminium output, and stricter energy and environmental standards for new alumina and smelting projects. The plan reinforces the primary aluminium capacity cap, promotes clean energy adoption, and encourages regional integration of aluminium production and processing. SMM expects minimal short-term supply impact but sees strong long-term support for sustainable and high-quality industry growth.