Primary Aluminum Rises for Consecutive Days, Weak Orders Cause Alloys to Struggle to Catch Up [SMM Cast Aluminum Alloy Morning Comment]

Published: Aug 12, 2026 09:08

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[SMM Cast Aluminum Alloy Morning Comment: Primary Aluminum Rises for Consecutive Days; Weak Orders Leave Alloy Struggling to Catch Up] Yesterday, ADC12 market quotes consolidated on a strong note, with the SMM average price slightly raised by 50 yuan/mt. Supported by high raw material costs and strong aluminum prices, some enterprises followed with an increase of 100 yuan/mt. However, end-use demand remained in the high-temperature off-season, with downstream just-in-time procurement dominating. Transaction improvements were limited, and some enterprises temporarily held prices steady and waited on the sidelines. In the short term, cost support remains solid, leaving limited downside room for prices. However, the demand side exerts significant pressure on the price increase. ADC12 is expected to continue its consolidation pattern where cost support and demand constraints coexist, with the extent of the rise still dependent on a substantial recovery in end-use consumption.

8.12 SMM Cast Aluminum Alloy Morning Comment

Futures: The most-traded AD2610 contract opened at 23,595 yuan/mt overnight, reached a high of 23,680 yuan/mt and a low of 23,595 yuan/mt, and closed at 23,655 yuan/mt, up 80 yuan/mt, or 0.34%. SMAs for all periods diverged upward, with the price holding firmly above all moving averages, and the bullish trend continued. Trading volume was 4,794 lots, significantly higher than the previous period, reflecting more active capital flow during the price’s upward breakout and a bullish surge. Open interest stood at 19,810 lots, up 279 lots, with rising open interest accompanying price gains, indicating new long money entering the market and intensifying the tug-of-war between longs and shorts.

Spot-futures price spread daily: According to SMM data, on August 10, SMM ADC12 spot price held a theoretical premium of 740 yuan/mt over the closing price of the most-traded AD2610 contract at 10:15.

Warrant daily: SHFE data showed that on August 11, total registered warrants for cast aluminum alloy were 17,285 mt, down 30 mt from the previous trading day. By region: Shanghai’s total registered volume was 1,506 mt, down 0 mt from the previous trading day; Guangdong’s total registered volume was 1,312 mt, down 0 mt; Jiangsu’s total registered volume was 3,806 mt, down 0 mt; Zhejiang’s total registered volume was 7,082 mt, down 0 mt; Chongqing’s total registered volume was 2,794 mt, down 30 mt; and Sichuan’s total registered volume was 785 mt, down 0 mt.

Aluminum scrap: Yesterday, SMM A00 spot aluminum price closed at 24,100 yuan/mt, up 110 yuan/mt from the previous trading day. In China’s aluminum scrap market, aluminum tense scrap prices held steady amid a wait-and-see stance, while bare bright aluminum wire and aluminum extrusion scrap free of paint followed the rise. In terms of scrap spreads, on August 11, the price difference between A00 aluminum and mixed aluminum extrusion scrap free of paint in Foshan was around 2,360 yuan/mt, and the price difference between A00 aluminum and shredded aluminum tense scrap was around 1,260 yuan/mt. As primary aluminum prices continued to rise, aluminum scrap lacked momentum to follow, causing the scrap spreads to widen again. This week, shredded aluminum tense scrap priced based on aluminum content is expected to be dragged by stagnant raw material prices and weak downstream demand, remaining under pressure overall, with the mainstream trading range expected to center around 20,200-20,800 yuan/mt.

Silicon metal: Yesterday, SMM’s oxygen-blown #553 silicon in east China was around 9,100-9,200 yuan/mt and #441 silicon was around 9,200-9,400 yuan/mt, with price center shifting slightly higher WoW. Futures market sentiment stayed relatively strong, with the most-traded SI2609 contract trading around 8,600 yuan/mt and the market moving higher. Combined with silicon enterprises’ reluctance to sell at low prices, low-priced cargoes in the silicon metal market dwindled, suppliers raised their offer centers, wait-and-see sentiment among downstream players was heavy, and the overall trading atmosphere was subdued.

Markets outside China: In terms of imports, current overseas ADC12 offers edged up to $3,090-3,120/mt, and the immediate import loss widened again to over 1,000 yuan/mt.

Summary: Yesterday, ADC12 market quotes consolidated on a strong note, with the SMM average price edging up 50 yuan/mt. Some enterprises followed with a 100 yuan/mt hike supported by high raw material costs and strong aluminum prices. However, end-use demand was still in the high-temperature off-season, downstream users mainly made just-in-time procurement, improvement in transactions was limited, and some enterprises held steady on the sidelines. In the short term, cost support remains solid, limiting the downside room for prices, while the demand side clearly caps the upswing. ADC12 is expected to extend its consolidation pattern characterized by both cost support and demand constraints, with any upside move awaiting a substantial recovery in end-use consumption.

[Data Source Statement: Except for public information, all other data are derived from public information, market communication, and SMM's internal database models, processed by SMM, for reference only, and do not constitute investment advice.]

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM's internal database model. They are for reference only and do not constitute decision-making recommendations.

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