SMM Aluminum Morning Meeting: Off-Season Demand Declines, Short-Term Price Rebound Unsustainable

[SMM Aluminum Morning Meeting Summary: Demand Declines in Off-Season, Aluminum Prices Rebound in the Short Term but Sustainability in Doubt]

Macro side, mixed signals persist. The Chinese government continues efforts to boost consumption, while uncertainty over the US Fed's interest rate cut pace intensifies. Fundamentals side, aluminum capacity remained stable in early January, while alumina fundamentals maintained a slight surplus pattern. Spot alumina prices may continue their downward trend in the short term, and the cost side of the aluminum industry is expected to keep declining. Demand side, market demand continues to weaken during the off-season, with operating rates in the aluminum processing industry declining steadily. Some aluminum processing plants are approaching holiday shutdowns. Although pre-holiday concentrated restocking has led to an unexpected inventory drawdown, temporarily boosting aluminum prices, the sustainability of this rebound is expected to be limited.