Aluminium scrap and alloy imports dropped Sharply in tandem, alloy exports hit single-month record high

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Futures: The most-traded aluminium alloy contract AD2607 closed at RMB 23,115 per tonne overnight, up RMB 35 from the previous trading day, a gain of 0.15 per cent. Trading volume was 2,299 lots, open interest was 15,130 lots, down 15 lots slightly, indicating relatively small divergence in capital flows and cautious tug-of-war between longs and shorts. Prices have risen above the 5/10-day moving averages, with short-term downside momentum weakening. The medium-term trend remains in the doldrums, with no clear bullish trend yet formed.

Industry dynamics: According to the latest customs data, China's aluminium scrap imports in April 2026 were approximately 171,000 tonne, down about 10 per cent Y-o-Y. Cumulative imports from January to April 2026 totalled 700,000 tonne. By source country, China's major aluminium scrap import sources in April were Thailand, the UK, Japan, the US, Australia, and other countries and regions, with Thailand accounting for 20.7 per cent of China's total imports. Unwrought aluminium alloy imports were 73,500 tonne, down 15.4 per cent Y-o-Y and down 12.9 per cent M-o-M. Cumulative imports from January to April were 313,900 tonne, down 14.6 per cent Y-o-Y. On the export side, unwrought aluminium alloy exports in April reached 46,300 tonne, a record single-month high, up 179.7 per cent Y-o-Y and up 68.9 per cent M-o-M. Cumulative exports from January to April were 111,200 tonne up 58.1 per cent Y-o-Y. Since March, affected by Middle East geopolitical conflicts and overseas supply disruptions, overseas aluminium alloy ingot prices have continued to rise, with the price spread between domestic and overseas markets inverting further. Currently, the theoretical loss on importing ADC12 into China has exceeded RMB 3,000 per tonne, the import window is essentially closed, and imports remain under pressure. Meanwhile, the supply gap in markets outside China persists, driving notable growth in export demand, with export volumes maintaining expansion for two consecutive months.

Spot-futures price spread daily report: According to SMM data, on May 20, the SMM ADC12 spot price was at a theoretical premium of RMB 580 per tonne t to the most-traded cast aluminium alloy contract (AD2607) closing price at 10:15.

Warrant daily report:  SHFE data showed that on May 20, total registered warrants for cast aluminium alloy were 38,401 tonne, down 303 tonne from the previous trading day. Of this, Shanghai had 2,515 tonne (unchanged), Guangdong had 10,428 tonne (down 241 tonne), Jiangsu had 7,532 tonne (up 300 tonne), Zhejiang had 11,942 tonne (down 212 tonne), Chongqing had 4,989 tonne (down 150 tonne), and Sichuan had 995 tonne (unchanged).

Aluminium scrap: Primary aluminium prices edged up RMB 60 per tonne from the previous trading day yesterday, while aluminium scrap market prices remained generally stable. Aluminium scrap market is expected to continue fluctuating at highs this week, with shredded aluminium tense scrap (priced based on aluminium content) mainstream range maintained at RMB 20,500-21,300 per tonne (tax-exclusive). Supply side, the tightening fiscal and tax supervision is unlikely to ease in the short term, and ticket shortages and expectations of reduced imports will continue to provide floor support for aluminium scrap prices, with the market pattern of yards holding prices firm and holding back from selling persisting. Demand side, off-season effects continue to intensify, with insufficient incremental end-user orders. Secondary aluminium enterprises are cutting production, and downstream procurement remains dominated by small just-in-time restocking, making concentrated stockpiling unlikely. The secondary aluminium market is expected to continue its pattern of weakness in both supply and demand.

Silicon metal: On May 20, SMM east China non-oxygen blown #553 was unchanged from the previous day; oxygen-blown #553 was unchanged; #521 was unchanged; #441 was unchanged; #421 was unchanged; #421 for silicone use was down RMB  50 per tonne; #3303 was unchanged. Some silicon prices in Xinjiang continued to decline. Silicon prices in Huangpu Port, Tianjin, Kunming, Northwest China, Sichuan, and Shanghai remained stable.

Markets outside China: On the import side, current import ADC12 quotes edged down but remained in the high range of USD 3,340-3,430 per tonne, with immediate import losses exceeding RMB 3,000 per tonne and the theoretical import window remaining closed.

Summary: The ADC12 market was dominated by a wait-and-see approach with stable prices yesterday, with SMM ADC12 prices unchanged from the previous day at RMB 23,600 per tonne. Demand side, narrow aluminium price fluctuations and tepid downstream procurement limited upward price adjustment room. Cost side, tight compliant aluminium scrap supply, persistent ticket shortage issues, and elevated import costs provided clear cost support. Additionally, signs of production cuts at some producers emerged, with market expectations of subsequent supply tightening warming up. Combined with cost support, enterprises have the willingness to increase prices in the short term. Overall, ADC12 prices are expected to move sideways in the near term.

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