Huge backwardation structure, spot weakness unchanged [SMM South China aluminum spot daily review]

Published: Oct 14, 2026 15:28 (GMT+8)

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SMM, October 14:

Aluminum prices continued to fall today, and the spot market remained weak. The backwardation structure was huge, and the basis around the contract rollover stayed elevated, still exerting major pressure on spot. Most sellers opted to cash out promptly at high levels and had no intention of holding inventory, with strong willingness to ship and more offers marked down. Mainstream quotes were in the discount to parity range, and spot liquidity at discounts was ample. As absolute prices declined for consecutive sessions, wait-and-see sentiment picked up somewhat, while the pace of incremental restocking stayed relatively steady. Combined with wariness of the high basis and limited market participation, overall demand failed to match supply, and transactions were poor. Spot deals were concentrated at premiums of 310–350 yuan/mt over the SHFE aluminum 2611 contract.

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