Recently, the domestic aluminum ingot market inventory structure has undergone a phased adjustment. The previously troubling backlog of shipments from Xinjiang has been gradually resolved, leading to a rebound in supply chain circulation efficiency. However, at the same time, inventory buildup pressure has emerged in some storage areas, compounded by regional market differences and weak downstream demand. As a result, domestic aluminum ingot inventory is characterized by "overall circulation improvement with localized pressure becoming prominent." This article provides an in-depth analysis of the current domestic aluminum ingot inventory situation based on the latest shipment, in-transit, and storage area feedback data, and offers predictions for future trends...

【SMM Analysis】The European Union’s Carbon Border Adjustment Mechanism (EU’s CBAM) took a decisive step from its pilot phase towards actual enforcement in December 2025, only a month before it becomes effective January 2026. The aluminium sector, with a total trade value of USD 448 billion in 2024, faces CBAM's carbon-accounting requirements alongside five other high-carbon sectors. Changes look to favour low-carbon production through responsible sourcing of raw materials and energy usage, as well as rewarding countries taking initiatives to implement equivalents to CBAM. On the flip side, CBAM imposes higher costs on trading partners of aluminium products with high-carbon emission. This series of policies will likely raise aluminium products prices for consumers in the EU in the short-term, and reshape aluminium’s trade flow for years to come. This article will cover CBAM basics and frameworks, incorporate the newest updates of the December 17 package and provide aluminium sector-specific implications and outlooks.

[SMM Analysis]In November 2025, unwrought aluminum alloy imports were 73,200 mt, down 28.2% YoY and down 4.1% MoM. Cumulative imports from January to November 2025 were 914,200 mt, down 17.5% YoY.

[SMM Aluminum Morning Meeting Minutes: Internal Review]

[SMM Cast Aluminum Alloy Morning Comment: Aluminum Prices Strengthen, Alloy Market Follows Suit Positively] Spot market, SMM A00 aluminum price rose by 110 yuan/mt to 21,930 yuan/mt, while ADC12 price increased by 100 yuan/mt to 21,800 yuan/mt. The continued strength in aluminum prices has driven the secondary aluminum market to actively follow the upward trend and adjust prices. Currently, raw material supply is tightening, coupled with secondary aluminum enterprises entering the stockpiling phase, aluminum scrap demand is rising, and traders' sentiment to hold prices firm is evident, supporting secondary aluminum costs. However, demand side is marginally weakening, with overall market transactions performing sluggishly. Supply side, recent heavy pollution weather warnings have been activated in multiple regions, leading some secondary aluminum enterprises to face production restrictions or shutdowns, resulting in a slight contraction in supply. Overall, cost support and tightening supply jointly solidify the price bottom, but slowing demand and aluminum prices fluctuating at highs are suppressing downstream purchase willingness. ADC12 prices are expected to maintain a fluctuating trend at highs in the short term.

[SMM Aluminum Morning Meeting Minutes: SHFE and LME Aluminum Prices Strengthen in Sync, Insufficient Fundamental Support Awaits Observation] Overall, from a macro perspective, the market needs to monitor the pace of interest rate hikes in Japan and its impact on the decline in aluminum prices. Domestically, fundamentals currently struggle to provide strong support for a sustained rise in aluminum prices, with end-use demand remaining weak and the proportion of liquid aluminum consequently declining. Subsequent attention should focus on changes in operating aluminum. Downstream processing enterprises continue to show weak sentiment in spot cargo procurement, and spot premiums continue to widen. With improved shipments from Xinjiang and an increase in transit inventory, social inventory is expected to accumulate this week, putting pressure on price support levels.

[SMM Cast Aluminum Alloy Morning Comment: Futures Surge Sharply, Secondary Aluminum Consumption Remains Supported] Last Friday, the SMM A00 aluminum price edged up by 90 yuan/mt to 21,820 yuan/mt, while the ADC12 price was raised by 50 yuan/mt to 21,700 yuan/mt. As aluminum prices climbed, the secondary aluminum market actively adjusted prices. Currently, raw material supply is relatively tight, coupled with secondary aluminum enterprises entering a stockpiling cycle, aluminum scrap demand has increased, and traders show a strong willingness to hold prices firm, providing solid support for secondary aluminum costs. However, intensified aluminum price fluctuations have heightened downstream wait-and-see sentiment, with demand marginally weakening and market transactions performing sluggishly. Overall, cost support keeps the price floor stable, but slowing demand and fluctuating aluminum prices jointly suppress purchase willingness. The ADC12 price is expected to continue fluctuating at highs in the short term.

According to SMM statistics, as of December 19, 2025, domestic aluminum rod plants' days of inventories reached 4.37, down 0.45 WoW, with inventory continuing its downward trend. In terms of inventory ratio, the domestic aluminum rod plant inventory ratio was recorded at 45.28%, down 6.2% WoW.

Overall, although the rigid demand for carbon used in aluminum production and anode materials provides some support to the market, it is insufficient to offset the pressure from overall weak demand. Against the backdrop of continuously increasing supply, petroleum coke prices have entered a sustained downward trend. Based on the above supply-demand pattern, SMM expects petroleum coke prices to remain in the doldrums in the short term. However, the market holds expectations for a recovery in January 2026, with the core driver being the concentrated release of stockpiling demand from downstream enterprises ahead of the Chinese New Year holiday, which is expected to provide temporary support to the market.