Futures: On Friday night, the most-traded cast aluminium alloy contract 2602 opened at RMB 21,310 per tonne, dipped to a low of RMB 21,205 per tonne during the session, then fluctuated upward, hitting a high of RMB 21,580 per tonne, and finally closed at RMB 21,545 per tonne, up RMB 155 per tonne or 0.72 per cent from the previous close, with a trading volume of 3,287 and open interest of 6,879, mainly driven by short position reduction.
Spot-Futures Price Spread Report: According to SMM data, on December 26, the SMM ADC12 spot price showed a theoretical premium of RMB 690 per tonne over the closing price of the most-traded cast aluminium alloy contract (AD2602) at 10:15.
Warrant Report: SHFE data shows that on December 26, the total registered warrant volume for cast aluminium alloy was 70,431 tonne, a decrease of 61 tonne from the previous trading day. By region, the total registered volume in Shanghai was 4,757 tonne, unchanged; Guangdong was 22,449 tonne, down 61 tonne; Jiangsu was 11,931 tonne, unchanged; Zhejiang was 24,955 tonne, unchanged; Chongqing was 5,919 tonne, unchanged; Sichuan was 420 tonne, unchanged.
Aluminium scrap side: On Friday, spot primary aluminium prices dropped slightly compared to the previous trading day, with SMM A00 spot closing at RMB 22,020 per tonne, while the aluminium scrap market remained basically stable overall. Some scrap utilisation enterprises reported high inventories of wrought aluminium alloy scrap accumulated during the peak season, lacking sufficient orders on hand to hedge raw material inventories, thus temporarily slowing the procurement pace for related scrap. Additionally, repeated environmental protection-driven production restrictions in some regions led to a slight weakening in downstream aluminium scrap demand. Secondary aluminium alloy scrap utilisation enterprises indicated that they are expected to begin Chinese New Year stockpiling soon and are currently conducting concentrated procurement of aluminium scrap raw materials, thus accelerating the procurement pace for aluminium tense scrap-based materials. As 2026 approaches, the implementation of resource recycling policies still faces significant obstacles, with issues concerning natural persons and invoice upper limits remaining difficult to resolve. Some recycling enterprises have already chosen to pass on additional tax burdens to the aluminium scrap supply side, posing a risk of downward pressure on the bottom of aluminium scrap prices. In terms of price trends, the operating centre for shredded aluminium tensile scrap (priced based on aluminium content) is expected to remain in the range of RMB 18,200-18,700 per tonne (tax excluded).
Silicon metal side: Spot silicon metal prices moved sideways last week. On Friday, SMM oxygen-blown #553 silicon in east China was at RMB 9,200-9,300 per tonne, and #421 silicon was at RMB 9,500-9,800 per tonne, with prices basically stable during the week. The most-traded SI contract closed at RMB 8,880 per tonne, with futures prices fluctuating upward. Downstream users exhibited a strong wait-and-see sentiment, and the order-signing atmosphere was not active.
Overseas market: Current overseas ADC12 offers are maintained in the range of USD2,630–2,650 per tonne. With domestic prices rising rapidly and the Renminbi strengthening, the immediate import profit has widened again, theoretically opening the import window.
Summary: Last Friday, SMM A00 aluminium ingot prices were quoted at RMB 22,020 per tonne, up RMB 40 per tonne from the previous trading day. ADC12 prices rose by RMB 50 per tonne to RMB 22,000 per tonne, returning to levels above RMB 22,000 per tonne for the first time since May 2022. Currently, raw material supply remains tight, while aluminium and copper prices continue to fluctuate at highs, with copper prices approaching RMB 100,000 per tonne, driving rapid price increases for aluminium scrap, especially aluminium tense scrap. Secondary aluminium alloy producers raised their offers multiple times within the day. On the demand side, signs of weakening emerged, as downstream acceptance of high prices was limited, fear of high prices intensified, and overall market transactions were sluggish. Supply side, affected by factors such as environmental protection-related controls, insufficient raw materials, or losses, capacity still faces contraction pressure. Overall, cost support and supply tightening jointly form a price floor, but slowing demand and aluminium prices fluctuating at highs constrain downstream purchase willingness. ADC12 prices are expected to continue fluctuating at highs in the short 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.
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