[SMM Aluminum Downstream Analysis: August Aluminum Processing Industry PMI Reached 53.3% – Structural Recovery Under September-October Peak Season Expectations, Full Recovery of Aluminum Processing Still Requires Observation] The comprehensive PMI of the aluminum processing industry in August recorded 53.3%, up 9.2 percentage points MoM and 9.7 percentage points YoY.

According to the latest monthly survey by SMM, China's total aluminum rod production in July 2025 reached 360,500 mt, down 29,600 mt from June. Against the backdrop of continuous aluminum rod capacity expansion, after excluding the impact of calendar days, the operating rate of aluminum rod plants in July was only 53.2%, down 6.89% MoM and 6.7% YoY.

[SMM Analysis]On August 28, 2025, the Office of the US Trade Representative (USTR) announced a three-month extension of the "Section 301" tariff exclusions for certain Chinese goods. These tariffs originated from the US investigation into China's policies on technology transfer, intellectual property, and innovation. The exclusions, originally set to expire on August 31, 2025, have now been extended until November 29, 2025.

[SMM Analysis]On 15 August 2025 the U.S. Department of Commerce announced that 407 additional derivative products containing steel or aluminum will be brought under the scope of Section 232 tariffs. The measure takes effect at 12:01 p.m. Eastern Time on 18 August 2025. According to the notice, whenever these goods enter the United States—whether as in-transit shipments or already-held inventories—the steel or aluminum content will be subject to a 50 percent ad-valorem tariff, and no exemptions may be requested.

[SMM Analysis]On 15 August 2025, the U.S. Department of Commerce announced that an additional 407 derivative products containing iron, steel, or aluminum will be brought within the scope of Section 232 duties. The measure enters into force at 12:01 p.m. Eastern Time on 18 August 2025. According to the notice, the steel- or aluminum-containing portion of these goods—whether they arrive as in-transit shipments or are already held in U.S. inventory—will be subject to a 50 percent ad valorem duty, and no exclusions will be granted. Under the combined “whole-vehicle proportional duty” mechanism (Sections 301 and MFN) and the “material-content proportional duty” mechanism (Section 232), even a seemingly moderate nominal rate on the finished product can translate into a markedly higher total tax burden whenever steel or aluminum accounts for a large share of value.

Futures: LME copper opened at $9,791.5/mt overnight, touched a low of $9,781/mt at the beginning of the session, then fluctuated upward to a high of $9,738.5/mt toward the end of the session, and finally closed at $9,839.5/mt, up 0.68%.

[Aluminum Morning Meeting Summary: September-October Peak Season Approaches, Aluminum Prices Hold Up Well] Recently, on the macro front, global trade tensions have continued to ease, with positive signals of cooperation from the Sino-Canadian Economic and Trade Commission, coupled with better-than-expected US economic data, boosting market risk appetite. Market sentiment has become more optimistic, providing support for aluminum prices. On the demand side, as August draws to a close, the September-October peak season is approaching, and signs of recovery in weekly operating rates this week are becoming more evident. The operating rate of leading domestic aluminum extrusion enterprises increased by 1.5 percentage points MoM to 52%, mainly driven by PV extrusion and other industrial extrusion companies. Other sectors such as aluminum plate/sheet, strip and foil, and aluminum wire and cable also saw some increase in their operating rates. In terms of inventory, according to SMM statistics, the inventory of aluminum ingot in major domestic consumption areas was 620,000 mt on August 28, up 4,000 mt from Monday and up 24,000 mt WoW. The absolute price of aluminum ingot pulled back slightly, and buying sentiment improved, but it has not yet reached a level that would stimulate large-scale restocking. During the off-season, the pace of inventory buildup and high aluminum prices will continue to suppress spot premiums. Overall, on the macro front, expectations for US Fed interest rate cuts and China's policy measures to boost domestic demand create a bullish atmosphere, which is expected to boost aluminum consumption prospects. However, it will take time for domestic policies to translate into actual consumption.

[smm cast aluminum alloy morning comment: aluminum ingot inventory increased by 2,380 mt in the week, resuming inventory buildup, demand slightly recovers as peak season approaches] aluminum prices pulled back yesterday, with secondary aluminum market quotes mainly stable. due to tight supply, aluminum scrap prices remained firm, continuing to support adc12 prices. moreover, frequent news of tax rebate cancellations and additional taxes in multiple regions has led to a strong desire among companies to pass on costs, resulting in prices being more likely to rise than fall in the short term. demand side, as the traditional september peak season approaches, downstream purchases have only mildly recovered, and despite active inquiries, actual transactions were average under high price suppression; the strengthening spot-futures price spread improved the sales situation for trading firms engaging in both spot and futures market.