Surging demand for aluminium in China has brought renewed attention to the most-traded aluminium contract on the Shanghai Futures Exchange (SHFE). On Tuesday, SHFE aluminium prices reached their highest level since November, signalling a potential upward trend driven by China's intensified focus on industrial growth and increased metals consumption.
After reaching a previous high on November 12, 2024, SHFE aluminium surged again on July 22, 2025, rising by 0.75 per cent to RMB 20,900 (USD 2,913.26) per tonne as of 0702 GMT. In parallel, SHFE alumina (SAOcv1) climbed 4.23 per cent to RMB 3,452 (USD 480.67) per tonne, the highest level since February 26, 2025.
As of July 18, aluminium inventories at SHFE-monitored warehouses (AL-STX-SGH) stood at 108,822 tonnes, reflecting the lowest level since February 2024, despite three consecutive weeks of rebounds, underscoring sustained demand strength. However, determining the actual demand and its possibility for materialisation is still unclear.
According to a Beijing-based futures analyst of a futures company, "The Chinese government's working plans to stabilise industrial growth and the launch of the giant Tibet hydropower plant are all positive signals to the metals market, with the prospect of the country's metals demand boosting the sentiment."
On the other hand, an analyst at SHFE shared, "Amid all the uncertainties, such news sounds definite and positive, which may support the commodities futures market for a while."
The possibility of the rising demand for aluminium from SHFE by China could be for building the world's largest hydropower dam on the eastern rim of the Tibetan Plateau, whose construction began on July 19, 2025, with an estimated cost of nearly USD 170 billion.
On the SHFE, nickel rose 1.51 per cent to RMB 123,530 (USD 17,203.07) per tonne, tin increased 1.11 per cent, zinc climbed 0.7 per cent to a three-month high and copper added 0.61 per cent, while lead edged down 0.21 per cent. On the LME, zinc, tin and copper posted marginal gains, while lead and nickel declined. Aluminium remained flat at USD 2,645.5 per tonne.
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