Typhoon "Hagibis" Briefly Disrupted Circulation in Guangdong's Secondary Aluminum Market [SMM Cast Aluminum Alloy Morning Comment]

SMM Cast Aluminum Alloy Morning Comment on 9.25

Futures: The most-traded cast aluminum alloy 2512 contract opened overnight at the day's low of 20,320 yuan/mt, hit a high of 20,470 yuan/mt, and finally closed at 20,435 yuan/mt, up 105 yuan/mt or 0.52% from the previous closing price. The trading volume was 2,263 lots, and the open interest was 11,460 lots, with the decrease mainly driven by bears.

Spot-Futures Price Spread Report: According to SMM data, on September 24, the theoretical premium of the SMM ADC12 spot price over the closing price of the most-traded cast aluminum alloy contract (AD2511) at 10:15 was 540 yuan/mt.

Warrant Report: On September 24, the total registered volume of cast aluminum alloy warrants was 15,213 mt, an increase of 4,277 mt from the previous trading day. The breakdown by region is as follows: Shanghai (3,073 mt, up 151 mt), Guangdong (1,571 mt, up 963 mt), Jiangsu (3,205 mt, up 629 mt), Zhejiang (4,783 mt, up 1,575 mt), Chongqing (2,581 mt, up 959 mt), and Sichuan (0 mt, unchanged).

Industry News: (1) Cui Dongshu, Secretary General of the China Passenger Car Association, stated that China's automobile exports in August 2025 reached 764,000 units, up 25% YoY and 12% MoM. For the period from January to August, exports totaled 4.94 million units, an increase of 21% YoY compared to the same period in 2024, showing overall strong performance. The main drivers this year remain the improved competitiveness of Chinese products and a slight increase in the Global South market. (2) Nantong Haijiang Aluminum Industry Co., Ltd.'s project with an annual output of 50,000 mt of secondary aluminum alloy ingot (liquid) is scheduled for a review and public announcement, with the public comment period running from September 23, 2025, to September 28, 2025. Utilizing existing factory buildings, Nantong Haijiang Aluminum Industry Co., Ltd. plans to construct a project with an annual output of 50,000 mt of secondary aluminum alloy ingot (liquid). The production process includes: sorting and warehousing, computerized ingredient batching, melting, slag removal and skimming, spectral analysis, refining, casting ingot, automatic ingot stacking, etc., along with supporting environmental protection facilities such as wastewater treatment systems, exhaust gas treatment systems, general solid waste storage, and hazardous waste storage.

Aluminum Scrap: On Wednesday, the spot price of primary aluminum was largely flat compared to the previous trading day, with the SMM A00 spot price closing at 20,680 yuan/mt. The aluminum scrap market prices remained generally stable. With the traditional peak season commencing, orders at some downstream scrap utilization enterprises have recovered. However, tight supply in the aluminum scrap market remains the dominant theme, keeping purchase prices high. The concentrated offer price for baled UBC was 15,500-16,100 yuan/mt (ex-tax), while shredded aluminum tense scrap (priced based on aluminum content) was concentrated at 17,200-17,700 yuan/mt (ex-tax). Baled UBC prices fell 100 yuan/mt WoW, while shredded aluminum tense scrap (priced based on aluminum content), scrap wheel hub, and mechanical casting aluminum scrap prices held steady. In Anhui province, aluminum tense scrap quotations collectively dropped 200 yuan/mt today. With over half of the golden September passed, enterprises in parts of Henan, Jiangxi, and Shandong reported that they have started stockpiling raw materials for the National Day holiday in advance. Amid the aluminum scrap shortage, overall market prices continued to hover at highs. Due to the impact of Typhoon "Hagibis," multiple areas in Guangdong province initiated the "Five Stops" emergency response, leading to a complete suspension of aluminum scrap yard operations, including receiving and dispatching goods, quotations, and logistics. Operations at affected yards are expected to resume in an orderly manner starting the 25th.

Silicon metal: On September 24, SMM non-oxygen blown #553 in east China was at 9,100-9,300 yuan/mt; oxygen-blown #553 at 9,400-9,600 yuan/mt; #521 at 9,500-9,700 yuan/mt; #441 at 9,600-9,800 yuan/mt; #421 at 9,600-9,800 yuan/mt; #421 for silicone use at 9,800-10,300 yuan/mt; and #3303 at 10,400-10,600 yuan/mt. Silicon metal prices in Kunming, Tianjin, Shanghai, Northwest China, Huangpu Port, Sichuan, and Xinjiang remained stable.

Overseas market: Overseas ADC12 offers were concentrated at $2,530-2,560/mt, while domestic spot prices stood at 20,000-20,200 yuan/mt, with the immediate import loss widening to over 200 yuan/mt. Local ADC12 offers in Thailand (excluding tax) remained at 81-82 baht/kg.

Inventory: According to SMM statistics, on September 24, the daily social inventory of secondary aluminum alloy ingots in Foshan, Ningbo, and Wuxi totaled 50,657 mt, up 733 mt from the previous day and up 1,758 mt from last Wednesday (September 17).

Summary: Yesterday, the SMM A00 aluminum price held flat at 20,680 yuan/mt, while the SMM ADC12 price remained stable at 20,950 yuan/mt. Currently, aluminum scrap prices are relatively firm, providing some cost support for ADC12. Demand side, downstream demand has seen a mild recovery since September, but the peak season performance fell short of expectations. As the National Day holiday approaches, die-casting enterprises have gradually scheduled shutdowns, with pre-holiday stocking demand providing short-term support to spot prices. Due to Typhoon "Hagibis," multiple areas in Guangdong province initiated the "Five Stops" emergency response, leading to a complete suspension of production and logistics at local secondary aluminum plants. That afternoon, as the typhoon's impact weakened, many areas lifted the "Five Stops" measures. Enterprise production and transportation are expected to resume in an orderly manner starting the 25th. Overall, rigid costs and stockpiling demand are supporting prices, but sluggish demand recovery and inventory pressure remain constraints. ADC12 prices are expected to fluctuate at highs in the short term, with close attention needed on raw material supply conditions, the pace of demand recovery, changes in registered warrants, and policy implementation.

[Data Source Statement: Except for publicly available information, other data are processed by SMM based on public information, market communication, and SMM's internal database model, and are for reference only, not constituting decision-making advice.]