Aluminum alloy futures fluctuate, focus on cost and demand performance [SMM Cast Aluminum Alloy Morning Comment]

SMM Cast Aluminum Alloy Morning Comment 11.12

Futures: The most-traded cast aluminum alloy 2601 contract opened at 21,030 yuan/mt overnight, fluctuated upward after opening, hit a high of 21,160 yuan/mt, bottomed at 20,995 yuan/mt, and finally closed at 21,135 yuan/mt, up 95 yuan/mt or 0.45% from the previous close. Trading volume was 1,907, and open interest was 15,104. Overall, the cast aluminum alloy 2601 contract is in a short-term bullish trend, fluctuating upward intraday, but the RSI is approaching overbought, and consolidation may follow.

Spot-Futures Price Spread Report: According to SMM data, on November 11, the SMM ADC12 spot price theoretically traded at a premium of 380 yuan/mt to the closing price of the most-traded cast aluminum alloy contract (AD2601) at 10:15.

Warrant Report: SHFE data showed that on November 11, the total registered warrant volume for cast aluminum alloy was 57,530 mt, up 270 mt from the previous trading day. By region: Shanghai (4,757 mt, unchanged), Guangdong (18,032 mt, unchanged), Jiangsu (10,548 mt, up 270 mt), Zhejiang (19,179 mt, unchanged), Chongqing (5,014 mt, unchanged), and Sichuan (0 mt, unchanged).

Industry News: According to CAAM data, in October, auto production and sales reached 3.359 million units and 3.322 million units, up 2.5% and 3% MoM, and up 12.1% and 8.8% YoY, respectively. From January to October, auto production and sales totaled 27.692 million units and 27.687 million units, up 13.2% and 12.4% YoY, respectively, with growth rates narrowing by 0.1 and 0.5 percentage points from January to September. In October, NEV production and sales reached 1.772 million units and 1.715 million units, up 21.1% and 20% YoY, respectively, with NEV sales accounting for 51.6% of total auto sales. From January to October, NEV production and sales totaled 13.015 million units and 12.943 million units, up 33.1% and 32.7% YoY, respectively, with NEV sales accounting for 46.7% of total auto sales.

Aluminum Scrap: On Tuesday, spot primary aluminum prices rose from the previous trading day, with the SMM A00 spot price closing at 21,620 yuan/mt. Aluminum scrap market prices followed aluminum higher. Baled UBC was quoted at 16,350-16,850 yuan/mt (ex-tax), and shredded aluminum tense scrap (priced based on aluminum content) was quoted at 17,800-18,450 yuan/mt (ex-tax). Price difference between A00 aluminum and aluminum scrap: The price difference between A00 aluminum and mechanical casting aluminum scrap in Shanghai widened by 130 yuan/mt to 2,882 yuan/mt MoM; the price difference between A00 aluminum and mixed aluminum extrusion scrap free of paint in Foshan widened by 120 yuan/mt to 2,409 yuan/mt MoM. Secondary aluminum scrap market is expected to hold up well this week, as the complex tug-of-war between sellers and buyers in the scrap aluminum market continues.

Silicon metal side: Yesterday, SMM oxygen-blown #553 silicon in east China was at 9,400-9,600 yuan/mt, flat from the previous day, while #441 silicon was at 9,600-9,800 yuan/mt, also flat. The SI2601 futures contract opened at 9,265 yuan/mt and closed at 9,180 yuan/mt, down 110 yuan/mt from the previous day. WoW, the spot silicon metal price center held up well, with silicon enterprises holding prices firm, but downstream users generally had limited acceptance of high prices, leading to inactive market trading sentiment.

Overseas market: Overseas ADC12 offers were at $2,590-2,620/mt, while domestic spot prices rose 100 yuan/mt to 20,700-20,900 yuan/mt, and the immediate import loss widened to above 300 yuan/mt. Local ADC12 offers in Thailand were at 84-85 baht/kg, excluding tax.

Inventory side: According to SMM statistics, on November 10, the daily social inventory of secondary aluminum alloy ingots in Foshan, Ningbo, and Wuxi totaled 49,705 mt, down 294 mt from the previous trading day and down 294 mt from the previous Monday (November 3).

Summary: Aluminum prices rebounded on Tuesday, with ADC12 prices rising 50 yuan/mt to 21,500 yuan/mt. Secondary aluminum market offers showed a divergent trend: some enterprises actively followed the increase by 100 yuan/mt driven by cost pressure and low inventory, while others maintained their offers and adopted a wait-and-see approach, mainly because high prices suppressed downstream purchase willingness. Currently, the tight supply of aluminum scrap persists, coupled with auxiliary materials such as copper prices fluctuating at highs, providing strong support on the cost side, and ADC12 prices still have short-term upward momentum. Demand side, although end-use consumption resilience provides a cushion, aluminum prices are at highs, and downstream procurement remains cautious. In the short term, ADC12 prices are expected to hold up well, and subsequent attention should focus on improvements in aluminum scrap supply, the implementation effects of relevant policies, and changes in downstream enterprises' procurement pace.

[Data source statement: Except for public information, other data are processed by SMM based on public information, market communication, and relying on SMM's internal database model, for reference only and do not constitute decision-making advice.]