On Monday, October 20, data released by the International Aluminum Institute (IAI) showed that global primary aluminum production in September increased by 0.9% YoY to 6.08 million mt, with daily average production at 202,700 mt.

On Tuesday, October 21, Citi stated that in the short term, they expect gold prices (previously bullish, now turned bearish) to reach a target of $4,000 per ounce within the next 0–3 months.

[SMM Cast Aluminum Alloy Morning Comment: The Most-Traded Contract Fluctuated with a Slight Decline Overnight, ADC12 Spot Premiums Widened] Yesterday, aluminum prices partially recovered from the previous day, with the SMM ADC12 price rising slightly by 50 yuan/mt to 21,100 yuan/mt. The current tight supply of aluminum scrap is unlikely to ease in the short term, providing solid cost support. Some enterprises have experienced a decline in operating rates due to raw material shortages or losses, while finished product inventories at plants remain low, leading to firm or actively rising quotations. Although demand has not shown significant improvement compared to September, it remains resilient overall, providing support for prices. However, high social inventory and warrant pressure may limit upside room, and attention should be paid to the impact of policy implementation on the supply side. In the short term, ADC12 prices are expected to hold up well, with a focus on raw material circulation, demand performance, and inventory changes.

[SMM Aluminum Morning Meeting Minutes: Limited Room for Demand Growth, Aluminum Prices Face Resistance to Further Gains] On the night of October 21, the most-traded SHFE aluminum contract opened at 21,000 yuan/mt, reaching a highest price of 21,045 yuan/mt and a lowest price of 20,955 yuan/mt, before finally closing at 20,970 yuan/mt, up 0.03%. The night session overall showed a pattern of retreat after rapid rise. From a technical perspective, insufficient volume constrained the rebound momentum, and the MACD 60-minute candlestick level red bars did not show sustained expansion. Although currently in a golden cross state, further upward movement still faces resistance. Considering recent highs and lows (monthly low of 20,640, high around 21,200), the resistance level is expected to be in the range of 21,280–21,480, while the support level is projected between 20,530 and 20,750.

【SMM Analysis】 Last week, the Aluminum Association (of America) released a white paper examining the flow of aluminium scrap of the United States, a sector that is starting to gain traction worldwide for its importance within the sectors and development goals of low carbon and circular sustainability goals, industrial competitiveness and strategic interests in national security. The white paper highlights several proposals made by the association, including the possible ban of UBC scrap exports from the USA totally.

[SMM Cast Aluminum Alloy Morning Comment: September Unwrought Aluminum Alloy Imports Down 13.2% YoY, Aluminum Scrap Imports Up 17.7%] In the short term, futures are consolidating, with the medium-term moving average system showing a bullish bias. However, prices remain within the consolidation range, and it is necessary to monitor the breakthrough at the resistance level of 20,400-20,420. If this level holds firmly, it may open upside room; if prices pull back below 20,350, be cautious of short-term adjustment risks.

[SMM Aluminum Morning Meeting Minutes: Supply-Demand Tightening and Aluminum Ingot Destocking Expected to Keep Aluminum Prices Holding Up Well in the Short Term] On the night of October 20, the most-traded SHFE aluminum contract opened at 20,900 yuan/mt, reaching a highest price of 20,935 yuan/mt and a lowest price of 20,830 yuan/mt, before finally closing at 20,920 yuan/mt, down 0.09%. The night session overall showed a trend of fluctuating upward, with prices rising from around 20,860 yuan/mt to near 20,920 yuan/mt. From a technical perspective, the night session's trading volume shrank, reflecting strong wait-and-see sentiment in the market; insufficient volume constrained the rebound momentum, and if the contraction continues, prices may retreat to test support levels. On the 60-minute MACD candlestick chart, the green bars are contracting but have not yet formed a golden cross, indicating an unclear short-term direction. Considering recent highs and lows (the monthly low around 20,600 and the high around 21,200), resistance is expected in the 21,280–21,480 range, while support lies in the 20,530–20,750 range.

[SMM Aluminum Morning Meeting Minutes: Macro Tailwinds and Solid Fundamentals Support Aluminum Prices to Hold Up Well in the Short Term] During the night session on October 17, the most-traded SHFE aluminum contract opened at 20,935 yuan/mt, reaching a highest price of 20,960 yuan/mt and a lowest price of 20,890 yuan/mt, before finally closing at 20,925 yuan/mt, down 0.2%. The night session overall showed a consolidating trend, fluctuating around 20,930 yuan/mt. From a technical perspective, the MA system maintained a bullish alignment (MA5: 20,928 > MA10: 20,903 > MA30: 20,818), with prices holding above the moving averages; the MACD indicator continued its golden cross (DIF: 63.3 > DEA: 58.6); however, trading volume was 51,011 lots, down 26,366 lots MoM. Considering recent highs and lows (monthly low around 20,600, high around 21,200), resistance is expected in the 21,280–21,480 range, with support in the 20,530–20,750 range.

[SMM Cast Aluminum Alloy Morning Comment: Warrant and Inventory Both Increase, Tight Aluminum Scrap Supply Supports Costs] Last Friday, aluminum prices held steady compared to the previous day, with the SMM ADC12 price also unchanged at 21,050 yuan/mt, showing limited momentum for price adjustments. The current tight supply of aluminum scrap is unlikely to ease in the short term, providing solid cost support. Some enterprises, constrained by material shortages or losses due to cost-price inversions, have seen a decline in their operating rates. Meanwhile, demand resilience and low plant inventories are supporting prices, but caution is warranted against the suppression of upside room from high social inventory and warrant pressure. Attention should also be paid to the impact of policy implementation on the supply side. In the short term, ADC12 prices are expected to hold up well, with key focus on raw material circulation, the pace of demand recovery, and inventory changes.