Cast Aluminum Alloy Most-Traded Contract Fluctuates Rangebound, Spot Market Shows Firmness [SMM Cast Aluminum Alloy Morning Comment]

SMM Morning Comment on Cast Aluminum Alloy on 10.15

Futures: The most-traded cast aluminum alloy AD2512 futures contract opened at 20,305 yuan/mt overnight, hit a high of 20,400 yuan/mt, bottomed at 20,305 yuan/mt, and closed at 20,370 yuan/mt, down 10 yuan/mt or 0.05% from the previous close. Trading volume was 1,135 lots, and open interest was 13,300 lots, with bears leading the increase in positions. Technically, the medium-term trend remains bullish, but the short-term is in a correction phase, with bearish funds slightly increasing positions and bullish momentum weakening. Support near the MA20 (around 20,406) needs to be watched.

Basis Report: According to SMM data, on October 14, the theoretical premium of the SMM ADC12 spot price to the closing price of the most-traded cast aluminum alloy futures contract (AD2512) at 10:15 was 535 yuan/mt.

Warrant Report: On October 13, the total registered volume of cast aluminum alloy warrants was 42,566 mt, an increase of 629 mt from the previous trading day. By region: Shanghai's total registered volume was 4,303 mt, unchanged from the previous day; Guangdong's total registered volume was 10,367 mt, an increase of 331 mt; Jiangsu's total registered volume was 8,592 mt, a decrease of 210 mt; Zhejiang's total registered volume was 14,290 mt, an increase of 508 mt; Chongqing's total registered volume was 5,014 mt, unchanged from the previous day; Sichuan's total registered volume was 0 mt, unchanged from the previous day.

Aluminum Scrap Side: Primary aluminum spot prices increased on Tuesday compared to the previous trading day, with the SMM A00 spot price closing at 20,900 yuan/mt. Aluminum scrap market prices generally followed the increase. Yesterday, baled UBC was quoted in a range of 15,850-16,350 yuan/mt (ex-tax), and shredded aluminum tense scrap (priced based on aluminum content) was quoted in a range of 17,300-17,800 yuan/mt (ex-tax). Baled UBC increased by 50 yuan/mt WoW, while shredded aluminum tense scrap (priced based on aluminum content), scrap wheel hub, and mechanical casting aluminum scrap remained flat WoW. Overall aluminum scrap market prices are expected to hold up well in October, with the mainstream price range for shredded aluminum tense scrap (priced based on aluminum content) projected to hover around 17,500-18,000 yuan/mt. The market needs to closely monitor the sustainability of downstream demand after the holiday and further guidance from primary aluminum price trends.

Silicon Metal Side: Spot silicon metal prices weakened slightly. Yesterday, SMM oxygen-blown #553 silicon in east China was at 9,300-9,500 yuan/mt, down 50 yuan/mt from the previous day. The futures market experienced strong fluctuations influenced by market rumors, with the intraday low at 8,455 yuan/mt, the high at 8,770 yuan/mt, and the settlement price at 8,520 yuan/mt, down 285 yuan/mt from the previous day and down 165 yuan/mt from Monday this week. Market trading was relatively active yesterday.

Overseas Market: Overseas ADC12 quotations held steady at $2,550–2,580/mt, while domestic spot prices fell by 200 yuan/mt to 20,200–20,400 yuan/mt, widening the immediate import loss to around 400 yuan/mt. The local ADC12 price in Thailand was quoted at 83 baht/kg, excluding tax.

In terms of inventory: According to SMM statistics, the daily social inventory of secondary aluminum alloy ingots in Foshan, Ningbo, and Wuxi totaled 49,125 mt on October 14, a decrease of 31 mt from the previous trading day.

Summary: Aluminum prices recovered some of their losses yesterday, while the secondary aluminum market remained stable with a wait-and-see approach. The SMM ADC12 price held steady at 21,000 yuan/mt. Price adjustment sentiment was moderate. Currently, raw material availability has not improved significantly, and enterprises continue to face cost pressure. At the same time, demand remains stable with a positive trend, providing support for prices. However, inventory pressure is exerting some downward pressure on prices. It is expected that ADC12 prices will maintain a fluctuating trend in the short term. Going forward, close attention should be paid to raw material supply conditions, changes in social inventory, and the pace of post-holiday demand recovery.

[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. They are for reference only and do not constitute decision-making advice.]