Last Friday night, the most-traded SHFE aluminum 2501 contract opened at 20,375 yuan/mt, reached a high of 20,425 yuan/mt, a low of 20,320 yuan/mt, and closed at 20,420 yuan/mt, up 30 yuan/mt or 0.15% from the previous day. Last Friday, LME aluminum opened at $2,594/mt, hit a high of $2,620/mt, a low of $2,586/mt, and closed at $2,599/mt, up $9/mt or 0.35%.
Summary: On the macro front, there is a possibility of a ceasefire in the Middle East and the Russia-Ukraine situation. Trump is expected to impose tariffs on Canada, Mexico, and China, raising concerns about a global tariff and trade war, putting pressure on the non-ferrous metals market. Domestically, positive signals were released, with November's manufacturing PMI above the 50 mark. On the fundamentals side, aluminum costs fluctuate at highs, sparking concerns about production cuts at high-cost enterprises. However, in the off-season, downstream buying sentiment has weakened, and the spot market is undergoing weak consolidation. In terms of inventory, railway shipments in Xinjiang have continued to improve, and arrivals have stabilized. Coupled with the limited sustainability of the off-season increase in aluminum ingot outflows from warehouses, it may be difficult to prevent continuous inventory buildup. The off-season inventory turning point is expected to arrive soon, significantly weakening the support of low inventory for aluminum prices. In the short term, apart from the cost side, the aluminum market faces limited additional support. The cancellation of export tax rebates for aluminum semis negatively impacts medium and long-term aluminum demand, putting overall market sentiment under pressure. Aluminum prices are expected to maintain a trend of fluctuating consolidation in the near term.
