June 30 News: According to SMM statistics, as of June 30, the inventory of aluminum ingots at domestic mainstream consumption areas stood at 468,000 mt, an increase of 5,000 mt from Thursday last week and an increase of 4,000 mt WoW from Monday last week.

[SMM Morning Comment on Cast Aluminum Alloy: PMI of Secondary Aluminum Industry Remained in Contraction Territory in June] Driven by the rise in aluminum prices last Friday, the cost of aluminum scrap generally increased, and the market had a strong willingness to raise prices. SMM ADC12 prices were increased by 100 yuan/mt to 20,000-20,200 yuan/mt. However, overall transactions remained weak, with downstream enterprises mostly maintaining just-in-time procurement. As July approaches, the sluggish growth in terminal orders will continue to suppress the upside room for ADC12 prices. Nevertheless, the cost support remains relatively strong, providing a floor for prices.

[SMM Aluminum Morning Meeting Summary: Social Inventory Buildup, Aluminum Price Center May Decline] Overall, on the macro side, domestic favorable policies continue to intensify, promoting consumption in the same direction; overseas macro factors are mixed, with risks still present. On the fundamental side, the casting ingot volume at some aluminum smelters has increased, coupled with the off-season downstream demand and fear of high prices, making market transactions far from ideal. Aluminum ingot inventory has seen a slight buildup, and spot premiums/discounts have weakened significantly. It is expected that aluminum prices may drop back slightly in the short term. Follow-up attention should be paid to the casting ingot volume and inventory changes.

【SMM Aluminum Downstream Analysis: Aluminum Processing Industry PMI Down 9.7% MoM in June — Pressure Across All Segments, Little Improvement Expected in Off-Season】June Aluminum Processing PMI Composite Index recorded 40.1%, falling below the boom-bust line, down 9.7 percentage points month-on-month and down 1.5% year-on-year.Downstream consumption entered the off-season, and the New Orders Index fell significantly, dragging down the performance of the composite index...

SMM believes that in the short term, aluminum ingot inventory will remain below 500,000 mt, and the high aluminum price will continue to suppress downstream consumption. After experiencing short-term consumption-stimulating phases such as the "PV installation rush" and "export rush," downstream extrusion orders are weakening. Coupled with seasonal impacts, extrusion plant orders are expected to remain weak, and many are maintaining a wait-and-see attitude towards raw material procurement, leading to sluggish destocking of aluminum billets and a clear establishment of the inventory buildup turning point. Despite reports in the past week of reduction measures by aluminum billet producers, due to the increased proportion of road freight transportation in the market and the fact that in-plant inventory accumulation is still in its initial stages, there may be a certain time lag before the off-season sentiment in the downstream sector translates into an increase in visible social inventory. Therefore, although the inventory buildup turning point for aluminum billets has been established, influenced by changes in the aluminum billet supply side, the growth trend may remain predominantly slow. It is expected that aluminum billet inventory will fluctuate at highs between 135,000-160,000 mt in the short term, and it is still necessary to monitor the production cut rhythm of aluminum billet producers in various regions...