Relaxation of Secondary Aluminum Import Restrictions, Continued Destocking of Aluminum Ingot Inventory [SMM Aluminum Morning Briefing Oct 25]

Overnight, the most-traded SHFE aluminum 2412 contract opened at 21,020 yuan/mt, reaching a high of 21,075 yuan/mt and a low of 20,615 yuan/mt, closing at 20,805 yuan/mt, down 115 yuan/mt from the previous close, a decrease of 0.55%. Trading volume was 136,700 lots, open interest was 229,700 lots, with a daily reduction of 12,400 lots. On Thursday, LME aluminum opened at $2,663/mt, hitting a high of $2,715/mt and a low of $2,613/mt, closing at $2,639.5/mt, down $17/mt, a decrease of 0.64%.

Summary: On the macro front, domestic policies continue to boost the economy, and global market liquidity remains ample. However, the potential ceasefire in the Middle East introduces new variables to macro sentiment. On the fundamentals side, the bauxite supply crisis has driven alumina prices to high levels, significantly increasing costs in the aluminum industry. Overall, in the short term, the supply-demand mismatch in the aluminum market is not prominent, but the uncertainties on the macro and cost sides may support aluminum prices to fluctuate at relatively high levels.