[SMM Cast Aluminum Alloy Morning Comment: Aluminum Scrap Supply Shortage Intensifies, ADC12 Price Fluctuates at Highs] Last Friday, the aluminum price broke through the 21,000 yuan/mt mark, and the SMM ADC12 price rose again by 100 yuan/mt to 20,950 yuan/mt. Affected by tight domestic and overseas aluminum scrap circulation resources and increased demand from scrap utilization enterprises, the aluminum scrap market shortage has intensified, with hoarding phenomena driving prices up rapidly. To ensure order delivery, some manufacturers are procuring at high prices or across regions, and continuously rising costs are further boosting the ADC12 price.

An aluminum enterprise in Shandong adjusted the benchmark price for its prebaked anode tender for September 2025, up 93 yuan/mt MoM. Meanwhile, a major domestic prebaked anode sales company raised its sales price, up 94 yuan/mt MoM. The raw material market for prebaked anodes is currently diverging, but the price of the main raw material, petroleum coke, remains on an upward trend, driving up overall costs and providing some support for prebaked anode prices. Supported by the raw material market, prebaked anode prices are expected to have further room for increase.

This week, the overall operating rate of leading aluminum downstream processing enterprises in China rose 0.4 percentage points WoW to 62.1%, with the "September peak season" effect continuing to strengthen and various sectors showing a stepwise recovery pattern. The operating rate of the primary aluminum alloy sector increased significantly by 1 percentage point to 57.6%, driven by strong capacity release from top-tier enterprises, though small and medium-sized enterprises still faced order gaps. The aluminum wire and cable industry's operating rate edged up 0.4% to 65.2%, as regional environmental protection inspections were lifted, but capacity recovery in Hebei lagged behind expectations, while power grid orders supported higher operating rates at leading firms. The aluminum extrusion operating rate rebounded 1 percentage point to 54%, with accelerated transition from architectural to industrial profiles, processing fees for PV frames hitting bottom and stabilizing, and new orders for automotive extrusion becoming a highlight. The operating rate of leading aluminum plate/sheet and strip enterprises held steady at a high of 68.6%, as the can stock stockpiling cycle neared its end, and demand resilience in automotive/3C sectors stood out. The aluminum foil industry's operating rate remained at a peak level of 71.9%, though peak season order growth fell short of expectations, with stable demand for packaging foil and battery foil. The operating rate of secondary aluminum producers rose slightly by 0.5% to 53.5%, as consumption-side improvements drove the rebound, but raw material shortages and policy factors continued to constrain capacity recovery. SMM believes that, driven by consumption recovery in terminal sectors such as 3C, automotive, and PV, the aluminum processing industry has re-entered its peak season rhythm. Although the real estate sector remains sluggish, ongoing order releases in the new energy sector have effectively offset this, and downstream aluminum consumption is still expected to increase. SMM expects the operating rate of the aluminum processing industry to continue rising in mid-September, but cautions about the impact of high aluminum prices on downstream stocking willingness.

Futures side, during the previous trading day's night session, the most-traded SHFE aluminum 2510 contract opened at 20,975 yuan/mt, reached a high of 21,025 yuan/mt, a low of 20,930 yuan/mt, and closed at 21,005 yuan/mt, up 0.43% from the previous close. LME aluminum opened at $2,622/mt, hit a high of $2,679.5/mt, a low of $2,621.5/mt, and closed at $2,679/mt, up 2.17% from the previous close.

[SMM Analysis]Domestic aluminum scrap prices continued to climb this week, with single-day adjustments in some regions reaching 300 yuan/mt. As of September 4, the SMM A00 price closed at 20,860 yuan/mt, up 250 yuan/mt WoW. Supply in the aluminum scrap market remained tight, particularly for aluminum tense scrap resources, where prices stayed firm, with mainstream offers excluding tax hovering between 17,300-17,800 yuan/mt. Baled UBC prices, supported by rigid demand, fluctuated within the range of 15,650-16,150 yuan/mt.

[SMM Aluminum Price Weekly Review: SHFE Aluminum Maintains Strong Performance During Peak Season Amid Domestic and Overseas Macro Tailwinds and Fundamental Recovery]

[SMM Aluminum Spot Market Midday Review: Futures Strengthened and Aluminum Prices Remained High, Spot Premiums/Discounts Continued Under Pressure] SHFE aluminum's morning trading center rose to around 20,870 yuan/mt. In east China, as aluminum prices increased, suppliers became more willing to sell, but downstream purchases were weak. Market transaction prices were at a discount of 20-10 yuan/mt against SMM prices. Today, the east China market selling sentiment index was 3.09, up 0.02 WoW; purchasing sentiment index was 2.71, down 0.03 WoW. Today, SMM A00 aluminum was quoted at 20,860 yuan/mt, up 110 yuan/mt from the previous trading day, at parity with the September contract and at a discount of 10 yuan/mt against the October contract.

[SMM Cast Aluminum Alloy Morning Comment: The Most-Traded Contract Rose 0.20% Overnight, Bulls Increasing Positions Dominated Futures] Aluminum prices adjusted narrowly yesterday, with the market holding steady and adopting a wait-and-see stance. Since the beginning of September, downstream consumption has shown a mild recovery trend, with demand continuing to improve, though the characteristics of the traditional peak season have not fully emerged. In the short term, ADC12 prices are expected to hover at highs, supported by costs. However, limited by factors such as modest demand recovery and increasing social inventory, further upside room for prices may be constrained.