Futures surged to test the 24,000 yuan/mt mark, while the "nominal price without actual transactions" in the spot market intensified. [SMM Cast Aluminum Alloy Morning Comment]

1.13 SMM Cast Aluminum Alloy Morning Comment

Futures: The cast aluminum alloy 2603 contract opened at 23,400 yuan/mt overnight. The futures retreated after a rapid rise, climbing to a high of 23,940 yuan/mt at the open before pulling back to a low of 23,010 yuan/mt. It then fluctuated and recovered to close at 23,345 yuan/mt, up 105 yuan/mt or 0.45% from the previous close, with the increase mainly driven by bulls adding positions.

Basis Daily: According to SMM data, on January 12, the SMM ADC12 spot price theoretically traded at a premium of 745 yuan/mt to the closing price of the most-traded cast aluminum alloy contract (AD2603) at 10:15.

Warrant Daily: SHFE data showed that on January 12, the total registered warrant volume for cast aluminum alloy was 69,285 mt, a decrease of 637 mt from the previous trading day. By region, the total registered volume was 4,757 mt in Shanghai (unchanged WoW), 22,117 mt in Guangdong (down 91 mt WoW), 12,498 mt in Jiangsu (down 243 mt WoW), 23,274 mt in Zhejiang (down 303 mt WoW), 5,919 mt in Chongqing (unchanged WoW), and 721 mt in Sichuan (unchanged WoW).

Aluminum Scrap Side: Primary aluminum spot prices rose on Monday compared to the previous trading day, with SMM A00 spot closing at 24,340 yuan/mt. Aluminum scrap market prices followed the increase overall. Baled UBC was quoted in a range of 17,900-18,300 yuan/mt (ex-tax), while shredded aluminum tense scrap (priced based on aluminum content) was quoted in a range of 19,450-19,950 yuan/mt (ex-tax). In terms of the price difference between A00 aluminum and aluminum scrap, the price difference between A00 aluminum and mixed aluminum extrusion scrap free of paint in Foshan was 4,121 yuan/mt on January 12, and the price difference between A00 aluminum and shredded aluminum tense scrap was 2,944 yuan/mt. The aluminum scrap market is expected to hover at highs this week, with the mainstream range for shredded aluminum tense scrap (priced based on aluminum content) forecast at 18,800-19,200 yuan/mt (ex-tax). The tug-of-war between sellers and buyers continues, and it is necessary to closely track the trend of primary aluminum, the progress of downstream production halts, and pre-holiday transaction conditions, while remaining vigilant against the risk of a pullback from highs.

Silicon Metal Side: On January 12, SMM prices in east China were non-oxygen blown #553 at 9,100-9,300 yuan/mt, oxygen-blown #553 at 9,200-9,300 yuan/mt, #521 at 9,300-9,500 yuan/mt, #441 at 9,300-9,500 yuan/mt, #421 at 9,500-9,800 yuan/mt, #421 for silicone use at 9,800-10,200 yuan/mt, and #3303 at 10,200-10,500 yuan/mt. Prices held steady in Kunming, Huangpu Port, Tianjin, Shanghai, Xinjiang, Sichuan, and north-west China.

Overseas Market: Current overseas ADC12 offers increased by $30 WoW to a range of $2,850–$2,890/mt, while the real-time profit for imports remained around 500 yuan/mt.

Summary: Aluminum prices performed strongly on Monday, with the A00 price rising by 310 yuan/mt in a single day to 24,340 yuan/mt, breaking through the previous historical high of 24,240 yuan/mt set in 2021. SMM ADC12 prices followed suit with an increase of 250 yuan/mt, reaching 23,950 yuan/mt. The secondary aluminum market showed clear follow-up momentum, with mainstream quotations generally raised by 200-300 yuan/mt. However, the market exhibited a "nominal price without actual transactions" characteristic, with actual transactions dominated by rigid demand. Downstream acceptance of high prices was limited, and wait-and-see sentiment remained strong. From the perspective of market drivers, cost support and a tight supply-demand pattern provided a floor for aluminum prices, but sluggish demand-side conditions constrained further price rises. Overall, buoyed by short-term macro tailwinds, ADC12 prices are expected to hover at highs. Currently, bullish and bearish factors are intertwined in the market, requiring close attention to changes in the supply-demand pattern and macro policy direction.

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