The most-traded cast aluminium alloy AD2512 futures contract opened at RMB 20,280 per tonne overnight, hit a high of RMB 20,370 per tonne, and finally closed at the lowest level of RMB 20,325 per tonne, up RMB 55 per tonne or 0.27 per cent from the previous closing price. Trading volume was 646 lots, and open interest was 11,813 lots, with the increase mainly driven by bulls.
Spot-Futures Price Spread Report: According to SMM data, on September 29, the theoretical spot price of SMM ADC12 was at a premium of RMB 635 per tonne to the closing price of the most-traded cast aluminium alloy futures contract (AD2512) at 10:15.
Warrant Report: On September 29, the total registered volume of cast aluminium alloy warrants was 28,781 tonnes, an increase of 6,221 tonnes from the previous trading day. By region, the total registered volume in Shanghai was 4,122 tonnes (up 1,049 tonnes), Guangdong 3,389 tonnes (up 997 tonnes), Jiangsu 7,595 tonnes (up 510 tonnes), Zhejiang 9,291 tonnes (up 3,182 tonnes), Chongqing 4,384 tonnes (up 483 tonnes), and Sichuan 0 tonnes (unchanged).
Industry Dynamics: According to SMM, the PMI for the secondary aluminium industry in September rebounded by 11.7 percentage points M-o-M to 61.2 per cent, returning above the 50 mark. This rebound was mainly driven by a mild recovery in downstream consumption, which led to a steady increase in orders and operating rates for secondary aluminium plants, although the overall performance still fell short of traditional peak season levels. Pressure on the raw material side continued to intensify: due to tight circulation resources of aluminium scrap domestically and overseas and growing demand from scrap utilisation enterprises, the supply-demand imbalance in the aluminium scrap market worsened. To ensure order delivery, some enterprises had to purchase raw materials at high prices or even across regions, resulting in low levels of both raw material and finished product inventories. Against this backdrop, some secondary aluminium enterprises adopted more cautious order-taking strategies, intentionally controlling order sizes, and operating rates were also constrained accordingly. Approaching the month-end, as most enterprises maintained continuous production or only suspended operations for 1-3 days during the holiday, pre-holiday stockpiling demand pushed raw material inventories to a slight rebound. Looking ahead to October, due to the extended Mid-Autumn and National Day holidays, orders for secondary aluminium plants are expected to face pressure again, and the PMI is projected to show a downward trend.
Aluminium Scrap: On Monday, spot primary aluminium prices fell compared to the previous trading day, with SMM A00 spot aluminium closing at RMB 20,690 per tonne, while aluminium scrap market prices overall remained stable. With the National Day holiday approaching, enterprises in some areas of Henan, Jiangxi, and Shandong reported that they had started stockpiling production raw materials in advance for the holiday. Amid the shortage of aluminium scrap, overall market prices remained high. Baled UBC was mainly offered at RMB 15,550-16,150 per tonne (ex-tax), and shredded aluminium tense scrap (priced based on aluminium content) was mainly offered at RMB 17,300-17,800 per tonne (ex-tax). Prices of baled UBC, shredded aluminium tense scrap (priced based on aluminium content), scrap wheel hub, and mechanical casting aluminium scrap remained flat W-o-W. Aluminium scrap prices are expected to hover at highs this week. Overall, the mainstream price range for shredded aluminium tense scrap (priced based on aluminium content) is projected to fluctuate around RMB 17,300-17,800 per tonne, while baled UBC prices are anticipated to hover near RMB 15,600-16,100 per tonne. The market should closely monitor the sustainability of downstream stocking demand ahead of the National Day holiday, the actual implementation pace of tax policies, and further directional cues from primary aluminium prices.
Silicon metal side: On September 29, SMM assessed non-oxygen blown #553 silicon metal in east China at RMB 9,200-9,400 per tonne; oxygen-blown #553 at RMB 9,400-9,500 per tonne; #521 at RMB 9,500-9,700 per tonne; #441 at RMB 9,600-9,700 per tonne; #421 at RMB 9,600-9,800 per tonne; #421 for silicone use at RMB 9,800-10,300 per tonne; and #3303 at RMB 10,500-10,600 per tonne. Individual silicon metal prices also declined in Tianjin, Northwest China, Huangpu Port, Xinjiang, and Shanghai. Prices held steady in Kunming and Sichuan.
Overseas market: Overseas ADC12 offers were concentrated at USD 2,530-2,560 per tonne, while domestic spot prices stood at RMB 20,000-20,300 per tonne, with immediate import losses widening to around RMB 400 per tonne. Local Thai ADC12 ex-tax offers remained at 81-82 baht per kg.
Inventory side: According to SMM statistics, the total daily social inventory of secondary aluminium alloy ingots in Foshan, Ningbo, and Wuxi reached 50,463 tonnes on September 30, up 413 tonnes from the previous trading day and increasing by 539 mt from Tuesday last week (September 23).
Summary: The SMM ADC12 price held steady at RMB 20,900 per tonne on Monday. Pre-holiday raw material stocking demand from secondary aluminium plants was constrained by tight aluminium scrap supply, increasing procurement pressure and supporting ADC12 prices. Demand side, as the National Day and Mid-Autumn Festival holidays overlapped this year, downstream die-casting enterprises extended their holiday breaks by 1-2 days YoY. Recent stockpiling was largely completed, but the overall stockpiling volume was limited. Overall, aluminium scrap costs continued to support ADC12 prices, but extended downstream holidays and persistent inventory accumulation capped upside room. ADC12 prices are expected to fluctuate rangebound before the holiday, with close attention needed on raw material supply, holiday inventory changes, and the pace of post-holiday demand recovery.
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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