PV frame makers maintain stable operations; Aluminium prices to consolidate amid mixed macro signals

PV aluminium extrusion: According to an SMM survey, operating rates at sampled PV frame enterprises remained stable overall this week, with some large frame producers maintaining high operating loads. A large frame enterprise in Anhui reported that October production was basically flat M-o-M, while export orders increased, accounting for around 20 per cent of its total production. Regarding processing fees for PV aluminium frames, most long-term contract orders have seen processing fees fall below RMB 2,000 per tonne, operating essentially near the cash cost line. Downstream at the module end, October module production estimates were revised down by 500-700 MW from the beginning of the month. China's November production is expected to fall by another 1 GW, with the December decline widening to 3-5 GW, mainly due to slower-than-expected centralised project deliveries in China and sluggish order ramp-ups in Europe, the US, Southeast Asia, and the Middle East. Based on delivery pace, centralised projects still have tail-end deliveries pending in early-to-mid November, with completion largely expected after late November. Overall, tail-end centralised deliveries in early-to-mid November will continue to support demand for PV frames, keeping short-term operating rates stable. However, once the December module production schedule decline widens, frame demand will weaken accordingly.

Raw material prices: During the period (2026.10.19-2026.10.22), the SMM A00 weekly average price stood at RMB 23,625 per tonne, up 0.11 per cent from the previous week. The macro front was mixed. Geopolitically, Israel-Iran conflict risks heated up again, and Middle East uncertainty kept risk premiums on crude oil and energy shipping elevated. Fed Chairman Warsh declined to signal rates ahead of schedule, and traders maintained expectations for a hold in October. The valuation pressure from the US dollar and interest rates on nonferrous metals marginally eased. Overall, macro sentiment remained cautious in the short term. Fundamentals: Supply side, with project replacement, a small amount of idle capacity was released, and China's weekly aluminium production edged up this week. Overseas, on October 21, an aluminium plant in the UAE was reported to have restored its operating rate to 50 per cent. Meanwhile, overseas sources indicated a production line failure at an Iranian aluminium plant, with possible impact on production, though the plant's scale is limited. Combined with continued production ramp-up at the Indonesian project, overseas supply continued to recover overall. Demand side, after aluminium prices fell from earlier levels, aluminium billet processing fees recovered. Aluminium billet producers in South China saw improved production, and the proportion of liquid aluminium rebounded by 0.06 percentage points M-o-M. Overall, consumption remained resilient in October. In summary, macro sentiment is relatively cautious. On fundamentals, inventory continued to draw down, providing short-term support for aluminium prices. SHFE aluminium front-month contract is expected to trade at RMB 22,900-23,600 per tonne next week, with LME aluminium at USD 2,950-3,050 per tonne. Going forward, close attention should be paid to China's aluminium semis export performance.

Note: This article has been shared by SMM and has been published by AL Circle with its original information without any modifications or edits to the core subject/data.